Which of the Following Is the Formula for Present Value

question 2

Multiple Choice

Which of the following is the formula for present value?

• A) FVn = P(1 + i)n
• B) FVn = (1 + i)/P
• C) FVn = P/(1 + i)n
• D) FVn = P(1 + i)-n

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Definitions:

Standard Cost

A predetermined cost of manufacturing a single unit or a number of units of a product, which is used for budgetary and cost control purposes.

Favorable Variance

Occurs when actual performance is better than expected, leading to lower costs or higher revenues than planned.

Budgeted Revenue

The projected income that a business or organization expects to generate within a specific period, often used for planning and performance evaluation.

Standard Costs

Predetermined costs assigned to goods and services, used as a benchmark for evaluating actual production costs.