Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
We have discussed the computation of the future value in the previous sections; here let us work the process in opposite. Let us assume you have won a lottery ticket worth Rs. 1000 and such Rs. 1000 is payable after three years. You should be interested in understanding the present value of Rs. 1000. Whether the interest rate is 10 percent, the present value can be computed by discounting Rs. 1000 to the present point of time as given below:
Value three years hence = Rs. 1000 (1/1.10)
Value one years hence = Rs. 1000 (1/1.10) (1/1.10)
Value now (Present Value) = Rs. 1000(1/1.10) (1/1.10) (1/1.10)
Formula
For compounding translates a value at individual point in time into a value at several future points in time. The opposite method translates future value in present value. Discounting translates a value get back in time. By the basic valuation equation
FV = PV (1 + k)n
Dividing both the sides by (1+k)n we find that
PV = FV [1/(1 + k)]n ............................Eq(10)
The factor [1/(1 + k)]n is termed as the discounting factor or the present value interest factor [PVIFk,n]
Q. Probability of Success in Application for Debt Finance? I have to advise you that there are signs of overtrading in our recent financial statements and our company is approa
The Wanless Corporation provides Internet consulting services to a wide-range of customers. The company's fiscal year ends on December 31. For the year ended December 31, 2011, the
Illustration regarding profit that head office can claim E Ltd sets up a branch in Nyeri on 1 July 2001. Goods are sent to branch at an invoice price which is 10% above cost. S
Determine the Range and quality of information Financial accounting reports concentrate on information which can be quantified in monetary terms. Management accounting addition
some lectures on branch accounting chapter of advance accounting or way how to do journal entries or way of branch accounting??i m totally unaware of this chapter and want to study
On January 1, 2014, Offshore Corporation erected a drilling platform at a cost of $5,420,142. Offshore is legally required to dismantle and remove the platform at the end of its 6
Question 1 Explain the functions of merchant banking and functions of financial intermediaries Question 2 What do you understand by book building and Green shoe option? Ex
Introduction to Pension funds Pension funds are normally set up to provide pension benefits to employees who have retired. The pension funds receive contributions mainly from e
I have a presentation on an article (around 20 pages). I also need 2 current real life examples (2 companies) to support the presentation. Can you do that? How long it will take yo
Retirement of a partner When one of the partners retires ante the others will continue trading, the n it is important that he gets a share of the goodwill that he helped create i
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd