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## Calculating Internal Rate of Return

Level 1

Good Morning,

I am creating a form for a cost benefit analysis and have been able to calculate the Annual Net Present Value out for 5 years.  I now need to have this form calculate the Internal Rate of Return.

I am using the FormCalc for all of my calculations.

Does anyone have any suggestions?

4 Replies

Level 7

Are you just needing to know how to calculate it? Here's a link to a wikipedia article that explains the calculation, without access to your form it's hard to give you a working example.

http://en.wikipedia.org/wiki/Internal_rate_of_return

Level 1

I have the formula on how to calculate it.  I need to find a way in order for it to be calculated automatically through the form.

Here is what my sheet looks like in Excel

 Cost Benefit  Analysis Completion of Project Equipment Cost Depreciation Term Risk Based Capital Requirements (11%) - Weighted Average Cost of Capital (WACC) 15.00% 0.99 1.99 2.99 3.99 4.99 Cash Savings or Inflows YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Increase in Revenues Costs or Process Savings Depreciation Recovery - - - - - Total Cash Inflows - - - - - Cash Outflows YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Equipment Cost - Annual Costs - - - - - Total Costs - - - - - Net Cash Flow - - - - - NPV Multiplier 1.000 0.870 0.756 0.658 0.572 Annual Net Present Value - - - - - Total NPV - Internal Rate of Return #NUM!

Within Excel the IRR is calculated using the following formula:  =IRR(B25:F25,15)  which uses the values from the annual Net present value sections.

Level 10

Go to your LiveCycle Designer and click on Help..

Enter "arithmetic functions" in the Index tab. Select the first one that matches the text and double click. You should see several FormCalc functions that you can use based on your requirement..

Thanks

Srini

Level 1

The calculations that are available within FormCalc won't calculate the Internal Rate of Return.