To Find the Present Value of a Single Amount,you Only

question 26

True/False

To find the present value of a single amount,you only need to know the amount to be received in the future,the interest rate and the number of periods until the amount will be received.With these three elements you can compute present value.

Recognize and create basic journal entries for various business transactions.

Understand the role of the general journal as the book of original entry.

Differentiate between debits and credits and their representation in journal entries.

Understand the role of financial statements and their preparation process, including interim statements.

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Definitions:

Equivalent Annual Cost

Equivalent annual cost is a financial analysis tool used to compare the cost effectiveness of different projects or investments with differing lifespans by calculating their equivalent cost per year.

EAC

Equivalent Annual Cost, a financial analysis tool used to compare the cost effectiveness of different investments or projects over their lifecycles.

Compute

To calculate or process information using a computer or mathematical methods.

Bid Price

The maximum price that a buyer is willing to pay for a security or commodity.