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These cash flows and dates are those on which the Net Present Value After Tax in the planEASe analysis of the Beach Overlook are based.
In its Annual Mode, planEASe Software assumes that operating cash flows occur during the year, and therefore plans them to occur in the middle of each year (July 1st) as an approximation of reality (mid-year convention). Calculators and Spreadsheets typically schedule these cash flows at the end of the year (year-end convention). Since the operating cash flows do actually occur during the year, the mid-year convention is more accurate.
The Net Present Value (NPV) of the Cash Flows shown in the table below, when discounted at 10.0000% to 1 Jan 2002 is ($3,703,520.46). One interpretation of this NPV is that you must pay $3,703,520.46 less on 1 Jan 2002 for the right to receive the cash flows shown, if you want a 10.0000% Internal Rate of Return on your total investment.
Date |
Years |
Cash Flow |
Present Value Discount Factor |
Present Value at 10.0000% |
| 1 Jan 2002 | 0.00 | ($1,252,500.00) | 1.0000000 | ($1,252,500.00) |
| 1 Jul 2002 | 0.50 | (1,567,601.00) | 0.9534626 | (1,494,648.91) |
| 1 Jul 2003 | 1.49 | (318,222.00) | 0.8676107 | (276,092.81) |
| 1 Jul 2004 | 2.50 | (324,054.00) | 0.7879856 | (255,349.89) |
| 1 Jul 2005 | 3.50 | (330,102.00) | 0.7163506 | (236,468.75) |
| 1 Jul 2006 | 4.50 | (336,378.00) | 0.6512278 | (219,058.70) |
| 1 Jul 2007 | 5.49 | (342,892.00) | 0.5925898 | (203,194.30) |
| 1 Jul 2008 | 6.50 | (349,656.00) | 0.5382048 | (188,186.53) |
| 1 Jul 2009 | 7.50 | (356,682.00) | 0.4892771 | (174,516.32) |
| 1 Jul 2010 | 8.50 | (363,984.00) | 0.4447973 | (161,899.11) |
| 1 Jul 2011 | 9.49 | (373,167.00) | 0.4047468 | (151,038.15) |
| 31 Dec 2011 | 10.00 | 2,358,835.00 | 0.3855433 | 909,433.01 |
| TOTALS | ($3,556,403.00) | ($3,703,520.46) |