Formula of annuity, Financial Accounting

Assignment Help:

In common terms the present value of a regular annuity may be shown as given below:

PVNn = A/(1 + k) + A/(1 + k)2+ ..................+ A/(1 + k)N

= A (1/(1 + k) + 1/(1 + k)2+ ..................+ 1/(1 + k)N)

= A [((1 + k)N- 1)/(k (1 + k)n)]

In case of annuity due:

PVAn (due ) = A [(1 + k)n  - 1)/(k (1 + k)n)] (1 + k)   ...........................Eq(12)

Here PVAn = Present value of an annuity that has a duration of n periods;

A = Constant periodic flows and k = discount rate


Related Discussions:- Formula of annuity

Other aspects of the consolidated balance sheet, OTHER ASPECTS OF THE CONSO...

OTHER ASPECTS OF THE CONSOLIDATED BALANCE SHEET The consolidated balance sheet may require a special approach under the following situations: 1) Pre-acquisition losses in subs

What is bequest, Q. What is Bequest? Bequest - A gift by will of person...

Q. What is Bequest? Bequest - A gift by will of personal property. If bequest is money to the extent it's paid out ofincome from property it is taxable to the recipient. Normal

Leverage, evaluate the importance of leverage in financial management of a ...

evaluate the importance of leverage in financial management of a small scale business

Beta of stock x, You have observed the following returns over time: ...

You have observed the following returns over time: Year Stock X Stock Y Market 2006 13% 13%

What amount of amortization expense, Day Corporation purchased a patent on ...

Day Corporation purchased a patent on January 1, 2012 for $360,000. The patent had a useful life of 10 years at that date. In January of 2013, Day successfully defends the patent a

Recieving order., 1.The debtor retains ownership, but loses possession and ...

1.The debtor retains ownership, but loses possession and control of his property

Explain major factor of ifrs, a. Explain a major factor which led to the in...

a. Explain a major factor which led to the introduction of International Financial Reporting Standards (IFRS). b. Explain how users of financial information benefit from IFRS.

Case Study, I have a case study due in one of my classes. There are 3 pages...

I have a case study due in one of my classes. There are 3 pages of information about the company in the case, and there are 12 questions I must complete. Each question is basically

Dissolution of a partnership, Dissolution of a partnership A partnership i...

Dissolution of a partnership A partnership is dissolved when: It is temporary (maybe set up for a given period which has lapsed); One partner notifies the others in writ

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd