All of the Following Are Conditions for an Ordinary Annuity

question 18

Multiple Choice

All of the following are conditions for an ordinary annuity due except

• A) periodic cash flows must be equal in amount.
• B) the time periods between the cash flows are the same length.
• C) the future value is equal to the present value.
• D) interest is compounded at the end of each time period.

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Definitions:

Expense

An outflow of cash or other valuable assets from a person or company to another entity in exchange for goods or services or as a cost for generating revenue.

Capitalize

To record a cost as an asset, rather than an expense, delaying the recognition of the expense over time through depreciation or amortization.

Trademarks

Distinctive signs or symbols used by a business to identify and differentiate its products or services from those of others.

Intangibles

Non-physical assets possessed by a business, such as patents, trademarks, and copyrights, which have value due to the rights or information they convey.