WORKING PAPERS F/ FUND ACCOUNTING
WORKING PAPERS F/ FUND ACCOUNTING
22nd Edition
ISBN: 9781308868394
Author: Wild
Publisher: MCG CUSTOM
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Chapter 17, Problem 8BTN
To determine

Introduction:

Future Value

• Future value is the value of an investment made today calculated as on a future period, determined today at a predefined rate of interest.

• Future value analysis helps in evaluation of several alternatives and investment opportunities in the form of long term investment decisions in property, stocks and shares of other companies etc.

• Future value calculations also help in analyzing make or buy decisions, selection or rejection and comparison of investment alternatives.

• Formula for calculation of future value:

FV=P*(1+r)^nWhere,P=The investment made every yearr = Rate of interest n = Duration of investment

To Determine:

Investment strategy to accumulate $1,000,000 by age 65

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