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Internal Rate of Return(IRR) - Capital Budgeting Techniques (in Hindi)
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Heena Malhotra
Believe in Conceptual Learning.

U
Unacademy user
Seems like someone's promoting Vajiram! I too joined it, and wasted 8 months.After misspending 1.35 lac i realized that NO coaching is needed, self study is the key. Talking about class notes, all of mine are stuffed in a box. Go for notes which suffices your particular subject/topic. Example, for economics- Sri ram, Current affairs- Vision, Geography- ALS, polity- vajiram, etc. this would help a lot.
Aswin Martin
3 years ago
would you please share the notes for gs it will be helpful for us who can't afford coaching and my mail id is aswinmartin008@gmail.com
Pushkar sharma
3 years ago
U perhaps were not good enough to take advantage of vajiram then, feeling sorry for u
Aman Raj
3 years ago
Self study is the secret of success M k gandhi
Rangrezz Vrez
3 years ago
agree,..
AB
Abhishek Bharti
3 years ago
Can u please suggest me some tips ? I'm doing b.tech ECE in 3rd ? How should I start my prepation ? Should I join chankya coaching ? My mail is Abhishekbharti260 @gmail.com Plz ma'am tell me something ...
Pushkar sharma
3 years ago
no chanakya please...
Hi..i aporeciate ur point abt d coaching, even me i had a trouble joining coaching..well..so Vajiram, Vision notes n all, wher can i get it? Is it available in the market??
To kya coaching bilkil jaruri nahi h
Pushkar sharma
2 years ago
coaching karo to sirf vajiram se anyatha mat karo
maam ur video lessons are so much beneficial , thank you very much . please help me in providing full answers for financial management ques 85 to 92 of july 2018 paper 2 from management subject
mam 11% pe kyu nhi calculate kiya direct 12% kyu?
Heena Malhotra
a year ago
khushboo 11% se bhi kr skte h, ans whi aayega.. :)
KHUSHBOO TIWARI
a year ago
ok mam
Mam is bar Jo NTA Net exam online hoga to kya Usme hum sirf Ek hi language select kr skte h.. Ya Apne according bar bar hindi or English dono me dekh skte h paper?????
Heena Malhotra
a year ago
Apne according aap har question ko Hindi ya English m check kr payege :)
  1. Capital Budgeting Decisions By Heena Malhotra


  2. Payback Period Traditional or Non Discounting ccounting Rat of Return (ARR) Capital Budgeting Techniques Net Present Value (NPV) Profitability Index (PI) Time adjusted or Discounted Cash Flows Internal Rate of Return (IRR) Modified Internal Rate of Return (MIRR) Discounted Payback By Heena Malhotra


  3. Internal Rate of Return Method (IRR) IRR Definition: Internal rate of return for an investment proposal is the discount rate that equates the present value of the expected net cash flows with the initial cas outflow By Heena Malhotra


  4. NPV PVCI - PVCo NPV- By Heena Malhotra


  5. Acceptance Rule The use ofIRR as a criterion to accept capital investment decisioninvolves a comparison of IRR with the required rate of return known as cut off rate. The project should the accepted if IRR is greater than cut-off rate. If IRR is equal to cut off rate the firmis indifferent.I IRR less than cut off rate the project is rejected. Thus, If IRR 2 Cut-off Rate or WACC Accept the Proposal IR S Cut-off Rate or WACC Reject the Proposal By Heena Malhotra


  6. Calculate the internal rate of return of an investment of 1,36,000 which yields the following cash inflows: Year Cash Inflows (in ) 30,000 40,000 60,000 30,000 20,000 By Heena Malhotra


  7. Let us discount cash flows by 10% 0. Year Discounting Present Inflows (?) factor at 10% | Value (?) 0.909 0.826 0.751 0.683 0.621 30,000 40,000 60,000 30,000 20,000 27,270 33,040 45,060 20,490 12,420 Total present 1,38,280 value The present value at 10% comes to 1,38,280, which is more than the initial investment. Therefore, a higher discount rate is suggested, say, 12% By Heena Malhotra


  8. Cash Inflows () 30,000 40,000 60,000 30,000 20,000 Year Discounting factor Present at 12% 0.893 0.797 0.712 0.636 0.567 Value (R) 26,790 31,880 42,720 19,080 11,340 1,31,810 2 3 4 Total present value By Heena Malhotra


  9. PUGI@ -PVCo PVCI@ PVCI@h |* (HR-LR) The internal rate of return is, thus, more than 10% but less than 12%. The exact rate can be obtained by interpolation 1,38,280-71, 36,000 1,38,280-1,31,810 IRR = | 10 + x 2 10+1 44 2,280 6,470 2 |-10+0.70 IRR = 10.70% By Heena Malhotra


  10. PVA n-1 n-1 1+i = R (PVI Fil + PVI Fi,2 + PVI Fi,3 + PWFm) R (PVIFi.n) By Heena Malhotra


  11. A company proposes to install machine involving a capital cost of3,60,000. The life of the machine is 5 years and its salvage value at the end of the life is nil. The machine will produce the net operating income after depreciation of 68,000 per annum. The company's tax rate is 45%. The Net Present Value factors for 5 years are as under: Discounting rate Cumulative factor 14 15 1617 18 3.43 3.35 3.27 3.20 3.13 You are required to calculate the internal rate of return of the proposal. SOLUTION Computation of Cash inflow per annum Net operating income per annum Less: Tax @ 45% Profit after tax Add: Depreciation 68,000 30,600 37,400 72,000 3,60,000/5 years) Cash inflow 1,09,400 By Heena Malhotra


  12. Computation of Internal Rate of Return 15% 3.35 3,66,490 C1,09,400x3.35) | 3,60,000 6,490 16% 3.27 3,57,738 ( 109,400x3.27) 3,60,000 2,262) Discounting Rate Cumulative factor PV of Inflows Initial outlay NPV R RR 156,490 -15+0.74 15.74%. 8752 By Heena Malhotra