# Shareholder Loan and Equity IRR

Many a time I’m requested to explain the relation between shareholder loan and the equity IRR. Should shareholder loan be part of equity IRR calculation? And if there are more than one equity investor, what should we do! Shareholder loan is a debt-like form of financing provided by the shareholders. Usually, it is the most junior debt in the company’s debt portfolio, and since this loan belongs to shareholders it should be treated as equity. We have discussed the relation between project IRR and Equity IRR earlier. In this post we will be discussing only about the shareholder loan and

# How Does Excel Calculate IRR?

Have you ever wondered how does Excel calculate internal rate of return (IRR)? I never gave it second thought until I wrote a post on the issues with NPV calculation in Excel. Our reader, Deyan, pointed that similar type of issue can exist with the IRR calculation in Excel. IRR calculation in Excel is rather simple; it follows the following syntax: Internal Rate of Return = IRR(values, [guess]) Where values are the cash flows. Values must contain at least one positive number and one negative number. Also note that it uses the order of values to interpret the order of

# NPV Calculation in Excel: Why the Numbers do not Match!

NPV calculation in Excel can be tricky. I have written few posts on this subject – NVP & IRR – Key Metrics of a Feasibility Analysis and Net Present Value and Returns to the Equity Holders. I recommend that you read them too. The basics of net present value (NPV) have been discussed on this site on many occasions. In this post we will be discussing the NPV formula in Excel and why the result may differ from the manual calculation. For this, we will consider a simple investment of 500$ in a project which generates 10$ each year in

# Rental Yield and Project IRR [Video]

Are Rental Yield and Project IRR related? Can we calculate the project IRR, if we know the rental yield? In the video we are discussing the relation between rental yield and project IRR. If you have any thoughts, use the comment section below.

# Residual Land Value [Video]

Transcript Residual land value is a land valuation tool based on simple economic concept that the land value is the surplus after development cost and profit have been deducted from the value of the completed development. So, Residual Land Value (RLV) = Value of the completed development – development costs – developer’s profit Estimating the development cost and the value of completed development are difficult and subjective in nature. Developer’s profit is the reward for taking the development risk and for initiating and facilitating the development. Developer’s profit varies from market to market. In developing economies the developer would seek

# Future Value Calculation in Excel

Future value calculation in Excel can be done either by using Excel FV formula or by manual calculation. Before we get into the calculations, let’s review the concept of future value. We have discussed the time value of money earlier. To remind ourselves, the basic premise of time value of money is that a dollar today is worth more than a dollar in the future. Money has interest earning potential and ‘interest earned’ over a period is referred to as the ‘time value’ of money. Suppose you have 100$ as of today and the bank deposit rate is 5%. Next

# Replacing Links with Values in Excel

Replacing links with values in Excel is a very useful tool. On many occasions before sharing our workbooks with external parties we prefer to replace the links with values. Links can be tricky – links to other workbooks can be in formulas, names, charts, text boxes, and other objects, both visible and hidden. Getting all the links and breaking them depends on the complexity of our workbook. We must be very careful if we have a complex workbook and want to replace the links with values before sharing it. In this post we will be exploring how replacing links with

# IRR Calculation in Excel

IRR calculation in Excel can be done very easily. It can be calculated using three different formulas – IRR, XIRR and MIRR. We have discussed the syntax and specific use of each formulas in a previous post. On the requests of our readers we did a video on IRR calculation in Excel. It is posted on YouTube on our channel and also embedded here. Hope you enjoyed this video on IRR calculation in Excel; if you have any comment, let me know through the comment section below. Also you can download the IRR calculation in Excel Workbook for free from