Capital Budgeting Excel Model
Originally published: 17/09/2018 09:26
Publication number: ELQ-97935-1
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Capital Budgeting Excel Model

The Capital Budgeting model helps determine whether new projects or capital expenditures are worth the investment.

Description
The capital budgeting model helps determine whether a new project involving new plants, products and/or equipment/machinery is economically viable and worth the investment. Your company should invest in projects that have a NPV (Net Present Value) that exceeds your firm's cost of capital in order to generate real value to the firm. The numbers in this model are strictly incremental. Instructional inputs are included in the model when hovering over the red arrows in the model.

- The model is easy to understand for any audience with instructional inputs for novice users
- Unlike other Capital Budgeting models available online, this model includes inflation-adjustment metrics.
- An inflation-adjusted model produces a more realistic analysis of an investment that is sensitive to real market factors
- Includes the option of analyzing both real estate and equipment expenditures for a project
- Including both real estate and equipment expenditures enables the user to more realistically value a real-life project
- Includes various valuation methods instead of a single method to further help determine project value
- Includes crucial inputs that should not be left out of a capital budgeting model to determine a project value

*Feel free to reach out with any questions or concern regarding the model.

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Further information

To help assist in capital planning and to ensure capital investment is allocated towards profitable and value-creating projects.

Investing in new equipment or real estate

Any non-capital expenditure situation


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