Net present value (NPV) represents the difference between the present value of cash inflows and outflows over a set time period. Knowing how to calculate net present value can be useful when choosing ...

NPV calculates profitability by considering all cash flows and the time value of money. A positive NPV indicates a potentially profitable investment opportunity. NPV's effectiveness relies on accurate ...

The income statement provides a breakdown of sales and expenses, and these can be made or paid with either cash or credit. Because of certain accounting conventions aimed at matching sales and ...

Small business owners frequently make decisions about how to invest money to increase profitability. Part of being a good business manager is the ability to analyze the income potential of long-term ...

Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia. Marguerita is a Certified Financial Planner (CFP), Chartered Retirement Planning Counselor ...