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Project Cost-Benefit Analysis Summary

The document contains financial information and calculations for 4 potential projects: insulating an office, taking out a mortgage, investing in a business, and saving with no investment. It includes costs, benefits, discount rates, net present value (NPV), return on investment (ROI), and payback period for each project over a 10 year period. A scoring matrix evaluates each project based on the criteria of NPV calculation, ROI calculation, and payback analysis.

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sudhacarhr
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14 views13 pages

Project Cost-Benefit Analysis Summary

The document contains financial information and calculations for 4 potential projects: insulating an office, taking out a mortgage, investing in a business, and saving with no investment. It includes costs, benefits, discount rates, net present value (NPV), return on investment (ROI), and payback period for each project over a 10 year period. A scoring matrix evaluates each project based on the criteria of NPV calculation, ROI calculation, and payback analysis.

Uploaded by

sudhacarhr
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd

Discount rate

PROJECT 1
(Insulating Office)
Costs
Discount factor
Discounted costs
Cumulative discounted costs
Benefits
Discount factor
Discounted benefits
Cumulative discounted benefits

4.8%
1
2
3
$18,000.00
$0.00
$0.00
0.95
0.91
0.87
$17,175.57
$0.00
$0.00
$17,175.57 $17,175.57 $17,175.57
$1,600.00
0.95
$1,526.72
$1,526.72

$1,600.00
0.91
$1,456.79
$2,983.51

$1,600.00
0.87
$1,390.07
$4,373.58

Cash flow
Discounted benefits - costs
Cumulative benefits - costs

-$16,400.00
-$15,648.85
-$15,648.85

$1,600.00
$1,456.79
-$14,192.06

$1,600.00
$1,390.07
-$12,802.00

NPV
ROI

-$4,699.92
-27%

Year
4
5
6
7
8
9
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
0.83
0.79
0.75
0.72
0.69
0.66
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$17,175.57 $17,175.57 $17,175.57 $17,175.57 $17,175.57 $17,175.57
$1,600.00
0.83
$1,326.40
$5,699.98

$1,600.00
0.79
$1,265.65
$6,965.63

$1,600.00
0.75
$1,207.68
$8,173.31

$1,600.00
$1,600.00
$1,600.00
0.72
0.69
0.66
$1,152.37
$1,099.59
$1,049.22
$9,325.68 $10,425.26 $11,474.49

$1,600.00
$1,326.40
-$11,475.59

$1,600.00
$1,265.65
-$10,209.94

$1,600.00
$1,207.68
-$9,002.26

$1,600.00
$1,152.37
-$7,849.90

$1,600.00
$1,099.59
-$6,750.31

$1,600.00
$1,049.22
-$5,701.08

Total
10
$0.00 $18,000.00
0.63
$0.00 $17,175.57
$17,175.57
$1,600.00 $16,000.00
0.63
$1,001.17 $12,475.66
$12,475.66
$1,600.00
$1,001.17
-$4,699.92

-$2,000.00

Year

Mortgage value without investment


Mortgage value with investment
$
40,000.00 $
30,000.00
1 $
42,600.00 $
31,950.00
2 $
45,369.00 $
34,026.75
3 $
48,317.99 $
36,238.49
4 $
51,458.65 $
38,593.99
5 $
54,803.47 $
41,102.60
6 $
58,365.69 $
43,774.27
7 $
62,159.46 $
46,619.60
8 $
66,199.83 $
49,649.87
9 $
70,502.82 $
52,877.11
10 $
75,085.50 $
56,314.12

Benefit based on investment


$
$
$
$
$
$
$
$
$
$

650.00
692.25
737.25
785.17
836.20
890.56
948.44
1,010.09
1,075.75
1,145.67

PROJECT 1
(Insulate Office)
Cumulative discounted costs
Cumulative discounted benefits

1
$17,175.57
$1,526.72

2
$17,175.57
$2,983.51

3
$17,175.57
$4,373.58

Payback of Project 1 (Insulate Office


$20,000.00
$18,000.00
$16,000.00
$14,000.00
$12,000.00
$10,000.00
$8,000.00
$6,000.00
$4,000.00
$2,000.00
$0.00

Cumulative discounted costs

PROJECT 2
(Mortgage Payment)
Cumulative discounted costs
Cumulative discounted benefits

Cumulati

1
2
3
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509

Payback of Project 2 (Mortgage


$12.00
$10.00
$8.00
$6.00
$4.00
$2.00
$0.00
1

Cumulative discounted costs

PROJECT 3
(Invest in Business)

Cumulative

Cumulative discounted costs


Cumulative discounted benefits

Err:509
Err:509
Err:509
Err:509
Err:509
Err:509

Payback of Project 3 (Inve


$12.00
$10.00
$8.00
$6.00
$4.00
$2.00
$0.00
1

Cumulative discounted costs

PROJECT 4
(Savings - no investment)
Cumulative discounted costs
Cumulative discounted benefits

Cu

1
2
3
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509

Payback of Project 4 (Savi


$12.00
$10.00
$8.00
$6.00
$4.00
$2.00
$0.00
1

Cumulative discounted costs

Cumulative

4
$17,175.57
$5,699.98

Year
5
6
$17,175.57
$17,175.57
$6,965.63
$8,173.31

7
$17,175.57
$9,325.68

8
$17,175.57
$10,425.26

9
$17,175.57
$11,474.49

ct 1 (Insulate Office)

Payback Graph of Project 1 (Ins

unted costs

10

Cumulative discounted benefits

Year
4
5
6
7
8
9
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509

roject 2 (Mortgage Payment)

Payback Graph of Project 2 (Mo

ted costs

10

Cumulative discounted benefits

Year
5

Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509

ck of Project 3 (Invest in Business)

Payback Graph of Project 3 (Inv

discounted costs

10

Cumulative discounted benefits

Year
4
5
6
7
8
9
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509
Err:509

k of Project 4 (Savings)

Payback Graph of Project 4 (Sav

ted costs

Cumulative discounted benefits

10

10
$17,175.57
$12,475.66

back Graph of Project 1 (Insulate Office)

10
Err:509
Err:509

back Graph of Project 2 (Mortgage Payment)

10

Err:509
Err:509

back Graph of Project 3 (Investment in Business)

10
Err:509
Err:509

back Graph of Project 4 (Savings)

Criteria
Projects calculated NPV
Projects calculated ROI
Payback analysis

Weight
Method 1 Method 1 Method 2 Method 2
35%
25
8.75
15
5.25
25%
25
6.25
25
6.25
40%
25
10
20
8.00
25
19.50

Method 4

Method 3

Payback analy

Projects calcu
Method 2

Projects calcu

Method 1

10

15

20

25

30

35

40

45

Method 3 Method 3 Method 4 Method 4


35
12.25
40
14
40
10
20
5
50
20
35
14
42.25
33

Payback analysis
Projects calculated ROI
Projects calculated NPV

40

45

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