The Net Present Value Method Part 7 Cash 11% Present Years Flows Factor Value Investment in equipment Now $ (160,000) 1.000 $ (160,000) Working capital needed Now (100,000) 200 (100,000) Annual net cash inflows 1-5 80,000 295,680 Present value of an annuity of $1 factor* for 5 years at 11%. Alternatively, the individual annual net cash inflows could be discounted using the related five separate "present value of a single payment of $1" factors. That method would produce the same present value of $295,680. *The present value factors in Appendix 126 are rounded to three decimal points. Another approach is to use Microsoft Excel's NPV function to perform these calculations using unrounded discount factors