Cash Flow and Its Calculation

Name: Cash Flow and Its Calculation
Rating: 4.7 (3 reviews)

Created byXiaofeng WANG

Last updated 1/2026

English

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What you'll learn

Comparison and Optimization: Select the most economically optimal solution from feasible alternatives.
Value Assessment: Quantify the profitability and investment value of a project.
Risk Management: Identify and address future uncertainties.
Cultivating Mindset: Develop the ability to incorporate economic analysis into technical decision-making.

Course content

1 section • 11 lectures • 1h 19m total length

Concept of Cash Flow7:23
Explore the concept of cash flow within engineering economy, as introduced in chapter 1 of the course.
Cash Flow and Its Calculation
Investment, Operating Revenue, Business Tax5:30
Explore how investment decisions relate to operating revenue and business tax within chapter 1 of engineering economy, highlighting the financial implications for engineering projects.
Operating Cost and Income Tax4:56
Analyze operating cost and income tax within engineering economy, chapter 1, with attention to regime changes and regional context reflected in the transcript.
Concepts of Depreciation and Amortization8:11
Explore depreciation and amortization concepts in engineering economy, understanding how asset value declines over time, cost allocation, and financial implications for projects.
05 Accelerated Depreciation Mehtods9:42
Explore accelerated depreciation methods and the changes introduced for 2022–2023, as presented in the course material.
Comparison of Depreciation Methods,Excel Depreciation Functions4:42
Compare depreciation methods and learn how to apply Excel depreciation functions for engineering economy analysis in chapter one.
Discussion on Double Declining Balance Method6:04
Explore the double declining balance method in engineering economy, chapter 1. Understand its core approach and its relevance.
Depreciation Calculation Methods in the US4:08
Explore depreciation calculation methods in the US within the engineering economy context, and learn to evaluate the structure and function of depreciation approaches.
Calculation of Loan Interest During the Construction Period8:45
Apply engineering economy chapter 1 principles to calculate loan interest during the construction period, and understand its impact on project costs.
Calculation of Net Cash Flow5:50
Master the calculation of net cash flow within chapter 1 of engineering economy, applying a clear method to evaluate cash movements.
The Impact of Depreciation on Net Cash Flow8:03
Explore how depreciation influences net cash flow in engineering economy chapter 1, helping students understand its effects on financial outcomes.
Investment, Operating Revenue, Business Tax
Net cash flow calculation
【Test】

Requirements

A foundational understanding of basic mathematics and the engineering project lifecycle is essential, though motivated beginners can readily acquire these concepts during the course.

Description

This course is delivered in Chinese with English slides and subtitles.

The core of Engineering Economics is to evaluate the economic effectiveness of engineering projects and technical activities. The foundation for all such analysis is "Cash Flow." This opening chapter aims to establish this central concept and master its fundamental calculation methods.

First, the chapter clarifies the definition of cash flow, which refers to the total actual cash inflows and outflows occurring at various points in time within a specific system (such as an investment project) over a calculation period. By constructing intuitive cash flow diagrams, the complex movement of funds throughout a project's life cycle can be transformed into a clear time-value sequence. This is an indispensable tool for economic analysis.

Secondly, the time value of money is a cornerstone principle of engineering economics. This chapter emphasizes this principle: money has a time-dependent value, meaning equal amounts of money at different points in time are not equivalent. Therefore, cash flows occurring at different times cannot be simply summed. To address this, we will learn basic equivalence calculation formulas, including single-payment and uniform-series compound amount (future value) and present worth (present value) factors. These calculations are key to translating the time value of money and lay a solid theoretical and technical foundation for subsequent in-depth economic evaluation.

In summary, the content of this chapter forms the cornerstone of the entire course. Accurately understanding and skillfully applying cash flow and its calculations is the essential first step toward making scientific economic decisions for engineering projects.

Who this course is for:

The primary audience for engineering economics includes engineers, project managers, corporate decision-makers, financial analysts, and government planners—essentially, anyone who needs to evaluate and select technical solutions from an economic perspective is a target learner.