We have covered Pay Back Period in great detail. The process is not difficult and usually takes hardly 05 minutes. But, there are friends who want to know the exact years with decimal values. For them, we are sharing the Excel formula which you can use to find out PBP. You just need to enter initial investment amount and the remaining cash flows and our formula will do the rest of the work.

**Example**

ABC is considering investing in a capital budget which requires initial investment of $ 400,000. The cash flows are as follows:

Year |
Amount |

0 | 400,000 |

1 | 125,000 |

2 | 200,000 |

3 | 145,000 |

4 | 150,000 |

We have developed the following Excel sheet:

From the above sheet, we can easily tell that project will recover its initial investment in the 3rd year. However, in order to calculate exact figure with decimals, we will usre this

**Excel formula:**

=(SUM($B$1:B4)>0)*(C3=0)*(ROW()-2-SUM($B$1:B3)/B4)

You can see in the above screen shot that initial investment of $ 400,000 is getting repaid in 2.51724 years.

Contents

Financial Ratios
Accounting Cycle
Accounting Principles
Financial Accounting Basics
Financial Statements Reporting
Bad Debts
Current Assets
Long-term Assets
Voucher System
Partnership
Depreciation
Work Sheet - 10 Column Work Sheet
Difference Between Reserve and Fund
Accounting for Leases
Capital reduction and reconstruction
Absorption of Company
Amalgamation
Accounting for Installment Sales
Basis of Recording Profit and Loss
Branch Accounting
Construction Contracts
Revenue Recognition
Accounting for Groups
Financial Analysis
Events After the Balance Sheet Date
Deferred Tax
Cost Accounting
Activity Based Costing (ABC)
Throughput Accounting
Relevant Cost
Break Even Analysis
Standard Costing
Inventory Management
Payroll Accounting
Royalty Accounting
Statistics
Master Budget
Salary Income
Microsoft Excel Tutorial
How to Count Number of Records between Two Dates
How to sum values in excel based on a criteria
Finding the first login and last logout time of employees
How to Print Salary Slips Using VLookup Formula in Excel
How to Calculate Net Present Value (NPV) in Excel
Income tax calculation excel sheet for salaried individuals
How to Calculate Pay Back Period in Excel
How to Calculate Declining Balance in Excel Using Formula
How to Calculate Double Declining Balance in Excel
How to Calculate Number of Payments on A Loan In Excel Using NPER
Count the Number of Excel Records That Fall Between Two Dates
How to Count Cells between Two Numbers in Excel
How to Prepare Exam Result in Excel 3D Sum Multiple Worksheets
How to Count Specific Text in Excel
Other Topics
Share or Stock Valuation Model
Financial Management Topics
Kinds of Endorsement
Letter of Credit, Kinds and Its Advantages/ Utilities
Modern Functions of a Commercial Banks
Difference Between Secured And Unsecured Loan
Excel conditional formatting red if negative green if positive
How to Remove Extra Spaces in Excel
Result Card or Result Sheet Creation Using Excel