Capital Budgeting: NPV, IRR, Payback | MUST-KNOW for Finance Roles

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  • Опубликовано: 27 дек 2024

Комментарии • 148

  • @KenjiExplains
    @KenjiExplains  2 года назад +11

    👉 Learn Finance & Valuation: www.careerprinciples.com/courses/finance-valuation-course

  • @sergiopadilla8453
    @sergiopadilla8453 8 месяцев назад +20

    Watching this 20 minutes before my test begins. LFG

  • @ramarisonandry8571
    @ramarisonandry8571 2 года назад +9

    The simplest method ever to calculate payback period. From Madagascar, thank you so much

  • @AMIRSOHAIL-li5do
    @AMIRSOHAIL-li5do Год назад +8

    Bro you summed up my entire grad in an simple way❤

  • @himanshugourd6978
    @himanshugourd6978 2 года назад +3

    Most of your videos are simplified & which is one of the reason becomes more interesting & help to understand a lot

  • @jca1028
    @jca1028 2 года назад +32

    You make complex topics easy to understand. Thank you for sharing your contents. 🙂

  • @wilma.espiritucrowley
    @wilma.espiritucrowley Год назад +1

    Thank you for this video. I was struggling to understand this just by reading the textbook and thus affecting my grades. You are now my go-to to understand financial management topics

    • @KenjiExplains
      @KenjiExplains  Год назад

      You're very welcome! You might also find this video useful: ruclips.net/video/1KvrQOQPCDI/видео.html

    • @wilma.espiritucrowley
      @wilma.espiritucrowley Год назад

      @@KenjiExplains thank you! I will check this out.

  • @syedazeem3097
    @syedazeem3097 Месяц назад +1

    Would love a video on the Oil & Gas Industry!

  • @Fikenews-why
    @Fikenews-why 6 месяцев назад +1

    Wow I never seen like this......simplicity.....from Ethiopia

  • @yogakannappar5885
    @yogakannappar5885 Год назад +1

    Thanks Kenji. Studying for a final this is super helpful

  • @hidankakuzu6052
    @hidankakuzu6052 2 года назад +2

    I'm here for the learning, not necessarily due to your smile. No not, really. 🥰😊

  • @zainabansari573
    @zainabansari573 Год назад

    I liked how you took real examples and explained everything through excel😍👏👏. After long time I enjoyed learning finance😌✨✨ super happyy🌟

  • @zainabansari573
    @zainabansari573 Год назад

    Thankss a Lott sir. Whole chapter explained in one video😍👏👏👏👏

  • @sangitashrestha734
    @sangitashrestha734 Год назад

    you explain the topic in the simplest way....easy to understand. I'm always searching finance topics i have a hard time understanding in your channel.

  • @michaelquach7046
    @michaelquach7046 2 года назад +7

    Great fundamental exercise for financial analysts 👍

  • @bytamz9828
    @bytamz9828 Год назад

    Well explained. I thought this would be too hard to do, but you made it easy. Can't thank you enough ❤

  • @yohanayoku6741
    @yohanayoku6741 Месяц назад

    This is very helpful. Thank you so much!

  •  5 месяцев назад

    U r doing great work, thanks for the lesson

  • @ifeoluwadada3895
    @ifeoluwadada3895 2 года назад +1

    Looking forward to your talking about scenario analysis, base, best and worst case. How this can make the model more realistic

  • @gansito6154
    @gansito6154 4 месяца назад

    Great video and great way of explaining thank you!

  • @willan3249
    @willan3249 2 года назад

    Keep going man, finance is easy with you !

  • @APAPictures
    @APAPictures 4 месяца назад

    Excellent Video.. Simple way you explained

  • @prospovkeo7982
    @prospovkeo7982 Год назад +1

    Great video and well explained,
    Quick question please, does the cash outflow related to project cost only or it is also included the operation expense? And how to determine the discount rate? Thanks

  • @camlex6310
    @camlex6310 2 года назад +1

    You’re better than my teachers!!

  • @alaminhossain9803
    @alaminhossain9803 2 года назад +1

    Hi kenji, How are you? I, am from Bangladesh, enjoy your blog as you make a content which helps finance processional or finance graduate like me. Please would you mind to telling me which excel tools ( i means excel's various technique and tools) are carrying significant - and should be learnt - to the finance discipline.

  • @zakirkarim8345
    @zakirkarim8345 4 месяца назад

    Thank you, it's very helpful, but I struggle to estimate the estimated inflow, do you have any tips?

  • @ifeoluwadada3895
    @ifeoluwadada3895 2 года назад

    You are too good, well explanatory

  • @scotolivera8207
    @scotolivera8207 2 года назад

    Great video, i am wondering if you can make a video covering how to prepare a Budget ?

  • @sudaiskhadim-n1y
    @sudaiskhadim-n1y Год назад

    thanks for sharing the video man lovely video

  • @shawn9969
    @shawn9969 2 месяца назад

    Hi would you include bank loan and its interest expense as part of the capital budgeting or even the NPV?

  • @AdnanSharifTripleFluffyOG
    @AdnanSharifTripleFluffyOG Год назад +2

    how do you determine the discount rate?

  • @cuthbertnyakurwa6800
    @cuthbertnyakurwa6800 Год назад

    Well explained thank you, but the subtitles are covering the diagram in some instances during the explanation

  • @cattuonghuynh4642
    @cattuonghuynh4642 8 месяцев назад

    omg thank you so much, you saved my life

  • @tasfia5904
    @tasfia5904 Месяц назад

    Hi, can you please explain why for the payback period we have to divide the previous cash flow by the net cash flow of year 4? Thanks.

  • @andreugiro2807
    @andreugiro2807 2 года назад +1

    Great content as always! Thanks man!😁

  • @markanthonyartiaga5325
    @markanthonyartiaga5325 2 года назад

    This is amazing. Thank you for sharing your content.

  • @keeganwilson7616
    @keeganwilson7616 4 месяца назад

    Great video!

  • @danielcabralravelo5652
    @danielcabralravelo5652 2 года назад +1

    Great content as always!

  • @VillageAtTheBoulders
    @VillageAtTheBoulders 2 месяца назад

    In a multi-tenant office building is the annual cash flow the NOI or the gross income, or is it the net income after an investor pays the mortgage?

  • @IbrahimShaikh-hn8gn
    @IbrahimShaikh-hn8gn 8 месяцев назад

    Dear Mr. Kenji I would like to known from where the cash inflows and outflows come. In my university life the tropics are taught us like that ways. I will very helpful if you informed me

  • @andymarci6766
    @andymarci6766 2 года назад

    Amazing Kenji!😁

  • @somphavansayavong
    @somphavansayavong 9 месяцев назад

    hello Mr kenji, i got two quik question, what about when we have our own caopital, and bank loan, should we insert it on the cash inflow, and also if possible do you have a video that u explain further on financtial term such as ROI, ROI etc... Ty

  • @UrbanAssassin95
    @UrbanAssassin95 2 года назад

    Amazing video! Do you have any tips for someone who is going into summer analyst intern program at a bank?

  • @4DModding
    @4DModding Год назад

    Very helpful explanations

  • @andrewkim485
    @andrewkim485 Год назад +2

    How do we find out the discount rate though? Can you also go over that aspect?

  • @chandrasekar9843
    @chandrasekar9843 8 месяцев назад

    Should we consider bank funding the project also as investment or consider Equity only as investment for IRR calculation ?

  • @petarspanovic2454
    @petarspanovic2454 Месяц назад

    My question is regarding the cash inflows and outflows. Say I do not have them currently as my company wants to invest into a inhouse machine that might cost $120,000. How would I do these calculations based on this ? Would I need to just assume the cash flows ?

  • @MuslimIslam01
    @MuslimIslam01 9 месяцев назад

    your videos are very useful. is you course on linkedin.

  • @MWAqua-s9k
    @MWAqua-s9k 22 дня назад

    How to get data of cash inflow and outflow from income statement, balance sheet, statement cashflow and fixed asset?

  • @casonalimudgal7986
    @casonalimudgal7986 7 месяцев назад

    Thanks al lot for this wonderful video

  • @johndoe-id2uh
    @johndoe-id2uh 7 месяцев назад

    How do you get the cash inflow data before even creating the store?

  • @vshamil1
    @vshamil1 2 года назад

    So well explained!

  • @makitube2116
    @makitube2116 2 года назад

    Its very nice teaching. Please attach if you have PPT note

  • @himanshugourd6978
    @himanshugourd6978 2 года назад +2

    Hii Kenji why don't you start teaching us VBA as well
    it's also great tool to learn

  • @foxinusakim991
    @foxinusakim991 Год назад

    So, all these inflow figures are estimated? How to calculate Inflows from only project 1?
    Thank you for your answers.

  • @angelclarke1942
    @angelclarke1942 2 года назад

    Do you have any videos on cost benefit analysis?

  • @solomonbhandari-young4154
    @solomonbhandari-young4154 2 года назад

    Best channel

  • @SavaSabev
    @SavaSabev 10 месяцев назад

    Amazing video

  • @Goatkidking
    @Goatkidking 2 года назад

    great video thank you very much

  • @raphapam07
    @raphapam07 Год назад

    How do you calculate the Discount Rate? if I only have the "Breakeven period" and the "Payback Period" ?

  • @Talia778real
    @Talia778real 2 года назад

    Great,thx.🙏

  • @ifeoluwadada3895
    @ifeoluwadada3895 2 года назад

    Well explanatory

  • @hossamsobhey9228
    @hossamsobhey9228 2 года назад

    Good job. keep it up.

  • @allenq.697
    @allenq.697 10 месяцев назад

    Thanks a lot.

  • @spotlesstv1574
    @spotlesstv1574 2 года назад

    Awesome 👍🇯🇲🇯🇲🇯🇲

  • @shitijjindal6157
    @shitijjindal6157 Год назад +1

    Hii can you explain what's role of working capital
    While I'm preparing NPV statement
    Like what does the working capital means here 😅

  • @Wisesamakkulau1595
    @Wisesamakkulau1595 2 месяца назад

    i want to ask, why NPV is different if i count it using financial calculator?

  • @mikheilitchulukhadze8554
    @mikheilitchulukhadze8554 2 года назад +1

    Please add the video for Cash flow (Direct, Indirect) thanks in advance

    • @KenjiExplains
      @KenjiExplains  2 года назад

      Working on a cash flow video for next week!

  • @lvbo3660
    @lvbo3660 3 месяца назад

    When I do the IRR use your method, it shows zero. Could you please help why mine calculation is wrong?

  • @p.nfajriani5115
    @p.nfajriani5115 7 месяцев назад

    any question, where you have 1.500.000 in project 1?
    can you help me to explain....

  • @ivanko1422
    @ivanko1422 Год назад

    What about terminal value? Don't we need to include that?

  • @prettykaypee
    @prettykaypee 8 месяцев назад

    Genius.

  • @eliasfayad3102
    @eliasfayad3102 10 месяцев назад

    how calculated Payback in month and day

  • @miamiwalking
    @miamiwalking 2 года назад

    Flodesk did not send me the download after I submitted my email address. Flodesk not ready for prime time?

    • @miamiwalking
      @miamiwalking 2 года назад

      Flodesk finally provided the download once I turned off my VPN.

  • @ferinfrn
    @ferinfrn 3 месяца назад

    cool!!!

  • @purvakokate1807
    @purvakokate1807 2 года назад

    on what basis did we choose discount rate as 8%. Was it just an assumption?

    • @joytessiee
      @joytessiee 4 месяца назад

      Yes. In real life you can use discount rates from banks

  • @sonerguney3225
    @sonerguney3225 Год назад

    Super

  • @eL_gAbaS
    @eL_gAbaS Год назад

    the IRR cell on your excel file has an error

  • @fredliu9722
    @fredliu9722 Год назад

    When will you get a 0% IRR but still have a very big NPV?

  • @businessaccount3177
    @businessaccount3177 6 месяцев назад

    thx

  • @willzinner8813
    @willzinner8813 2 года назад

    Can you explain the discounted payback in more detail?

    • @cyprienbazille5913
      @cyprienbazille5913 2 года назад +1

      You use the same technique as for the payback period but you discount the cash flow. Instead of summing all the cash flows to get the cumulative cash flow you sum the discounted cash flows.

    • @KenjiExplains
      @KenjiExplains  2 года назад +1

      Great answer!

  • @faisalhadi4034
    @faisalhadi4034 2 года назад

    what if there is cash inflow (from capital injection or debt) to finance the project? can we add that cash inflow in period "0"?

  • @samuelokema9126
    @samuelokema9126 Год назад

    For the payback period, shouldn't it be 3+ (45,000/495,000)? seems like the PJ needs only 45K to break even, and 3.9 years is too long!

  • @islamalamir2650
    @islamalamir2650 Год назад

    Hi Kenji,
    Hope all is well!
    Kindly be informed that the discount coupon is no longer working, so need your support to provide me with an active one

  • @kinett2930
    @kinett2930 2 года назад

    Good

  • @augustusg857
    @augustusg857 Год назад

    If a comp has a negative npv, then it doesn't have a payback period.

  • @m.chethankumar2420
    @m.chethankumar2420 2 года назад

    Your lived in which country brother

    • @KenjiExplains
      @KenjiExplains  2 года назад +2

      Studied in the US but I'm from spain :)

  • @samuellaary7123
    @samuellaary7123 Год назад

    please I need scholarship to be enrolled in your program

  • @jaimebeltejar8380
    @jaimebeltejar8380 2 года назад +2

    I don't understand why we pick the first project if the second one is going to give us more return with less investment. Besides the payback period is lower in the second one.

    • @alangerardohurta
      @alangerardohurta 10 месяцев назад

      Watch the video again, it seems that it was not very clear to you why the first project is a better option.

  • @nerveranya
    @nerveranya Год назад

    You did't explain and show how to CALCULATE the discounted payback period. I didn't get it from the video.

  • @Clifford1278
    @Clifford1278 2 года назад

    For a few months now I have been searching tirelessly for information on how to start investing. I even payed $1000 for a course that I now regret. It appears that there is no structured guidiance for beginners on how to get started in this realm. I've come across several investors making well over $250k/annum and would be grateful if anyone on here could provide insights on how to get started, identify potential stocks, when to make an entry, exit etc.

  • @josemosquera9308
    @josemosquera9308 2 года назад

    cOUPON FOR THJE COURSE? YO HAVE CONTENT IN SPANISH?

  • @merced24
    @merced24 2 года назад

    MIRR

  • @stephfoxwell.5520
    @stephfoxwell.5520 2 года назад +15

    Despite the economic downturn, I'm so happy 😊.I have been earning $ 60,000 returns from my $7,000 investment every 13days.

    • @johnnyalcucard.3136
      @johnnyalcucard.3136 2 года назад

      Hello what's the best way to get started with trade cos l've been making my personal research for a while now please a newbie?

    • @nathandanny8639
      @nathandanny8639 2 года назад

      All you need as a beginner to make good profit from Bitcoin is a professional trader who will| trade on your behalf else you may make losses

    • @johncooke.230
      @johncooke.230 2 года назад

      That is true, you need an expert trader to make good profit from Bitcoin trade,My life has totally changed since I started with $7,000 and now I make $ 39,450 every 11 days..

    • @isidorn9119
      @isidorn9119 2 года назад

      I will recommend my current trader Mrs Angelia Marie Brown ,she is from USA and her strategies are earning a lot of profit for me

    • @KevinLevine592
      @KevinLevine592 2 года назад

      communicate with her directly on 👇👇

  • @vijaybani1380
    @vijaybani1380 2 года назад

    First

    • @KenjiExplains
      @KenjiExplains  2 года назад

      Hahah nice! See you on next week’s video hopefully!

  • @arturlima8895
    @arturlima8895 2 года назад

    What’s your LinkedIn?

  • @catalina6859
    @catalina6859 2 года назад +1

    Hola, blogger, soy Catalina, la gerente de planificación de BitBank, estoy muy interesada en trabajar contigo y espero saber de ti.😊😊😊

  • @selupapelufilipo2949
    @selupapelufilipo2949 Год назад

    very helpful thank you.

  • @alejandrojara2024
    @alejandrojara2024 8 месяцев назад

    Thanks so much.