HP 12C Financial 12C manual Negative cash flow

74 Section 4: Additional Financial Functions

In summary, to enter the cash flow amounts:

1.Press fCLEARHto clear the financial and storage registers.

2.Key in the amount of the initial investment, press Þ if that cash flow is negative, then press gJ.

3.Key in the amount of the next cash flow, press Þ if the cash flow is negative, then press gK. If the cash flow amount is zero in the next period, press 0 gK.

4.Repeat step 3 for each cash flow until all have been entered.

With the amounts of the cash flows stored in the calculator’s registers, you can calculate NPV as follows:

1.Enter the interest rate, using ¼or gC.

2.Press fl.

The calculated value of NPV appears in the display and also is automatically stored in the PV register.

Example: An investor has an opportunity to buy a duplex for $80,000 and would like a return of at least 13%. He expects to keep the duplex 5 years and then sell it for $130,000; and he anticipates the cash flows shown in the diagram below. Calculate NPV to determine whether the investment would result in a return or a loss.

Note that although a cash flow amount ($4,500) occurs twice, these cash flows are not consecutive. Therefore, these cash flows must be entered using the method described above.

Keystrokes	Display
fCLEARH	0.00	Clears financial and storage
		registers.
80000ÞgJ	–80,000.00Stores CF0 (with minus sign for a
		negative cash flow).

File name: hp 12c pt_user's guide_English_HDPMF123E27	Page: 74 of 275
Printed Date: 2005/8/1	Dimension: 14.8 cm x 21 cm