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Present Value, Future Value


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Simple and Compound Interest Methods
 
Present Value, Future Value
Future Value = Present Value + Interest Amount
      Interest amount = Principal amount x Interest rate

Future Value of a Single Present Amount
      Future value = Present amount x (1 + r)n
          r  =  interest rate
          n =  number of periods

Future Value of an Ordinary Annuity
      Future value = Annuity Amount x [(1 +  r)n - 1] / r
          r  =  interest rate
          n =  number of periods
 
Present
Value of a Single Future Amount
      Present value = Future Amount x 1 / (1 +  r)n
          r  =  interest rate
          n =  number of periods

Present Value of an Ordinary Annuity
      Present value = Annuity Amount x [1 - 1/(1 +  r)n] / r
          r  =  interest rate
          n =  number of periods

Ordinary Annuity:  Same amount is paid at the end of each period.
  
Annuity due:  Same amount is paid at the beginning of each period.  
 
Tables for PV and FV Factors

Table of Future Value Factors for a Single Present Amount (pdf)
Table of Present Value Factors for a Single Future Amount (pdf)
Table of Future Value Factors for an Ordinary Annuity (pdf)
Table of Present Value Factors for an Ordinary Annuity (pdf)

How to derive PV and FV factors (pdf)


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U.S. GAAP Codification
International Financial Reporting Standards (IFRS)
 
Accounting Topics
Inventory Valuation Methods
Depreciation Methods
Revenue Recognition Principle
Accrual Basis vs. Cash Basis Accounting
Basics of Journal Entries
Ratios for Financial Statement Analysis
Overview of Financial Statements











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