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Excel XNPV Function

Excel XNPV function
Summary 

The Excel XNPV function is a financial function that calculates the net present value (NPV) of an investment using a discount rate and a series of cash flows that occur at irregular intervals.

Purpose 
Calculate net present value for irregular cash flows
Return value 
Net present value
Syntax 
=XNPV (rate, values, dates)
Arguments 
  • rate - Discount rate to apply to the cash flows.
  • values - Values representing cash flows.
  • dates - Dates that correspond to cash flows.
Usage notes 

The Excel XNPV function calculates the net present value (NPV) of an investment based on a discount rate and a series of cash flows that occur at irregular intervals. Cash flows need to be listed with dates in chronological order. Negative values represent cash paid out; positive values represent cash received.In the example shown, the formula in F6 is:

=XNPV(F4,B5:B10,C5:C10)

XNPV doesn’t discount the initial cash flow. Subsequent payments are discounted based on a 365-day year.  To discount to a particular valuation date, you can set up XNPV so that the first cashflow is zero, associated with the valuation date.

Notes:

  • Rate is provided as a percentage (.12 for 12%)
  • Dates and values must be in chronological order.
  • Dates must be valid Excel dates
  • XNPV doesn’t discount the initial cash flow

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