Future Value of Annuity Due by fschief


									                                    Future Value of Annuity Due

              If we pay series of fixed amount with fixed rate of interest for fixed period of
              time, then we can calculate the future total amount. These payments are paid at
              the beginning of each period. If the payments are many, then it will take much
              time to calculate the total final amount. We can use the following formula to
              calculate the amount easily:

              Future Value of ordinary Annuity =

                                     Where P = Periodic payments
                                     r = Rate of Interest
                                     n = Fixed periods

                           Excel 2010: FV Function of Annuity Due

              Syntax: FV(rate, nper, pmt, [pv], 1)

              This function syntax has the following arguments:

              rate : Rate of interest for per period (Required).

              nper : Total numbers of period (required)

              pmt : Fixed payment for each period

              pv : Present value.

Tips: If the rate is mentioned annually, convert it in rate per month (r/12) and if the total
periods are mentioned in months should be converted in months (nperX12)

The Excel 2010 syntax for this function is same as FV function of Ordinary Annuity. To confirm
the Annuity function in Annuity syntax of Excel 2010, we should put 1 after Present value (pv)
by a coma to confirm the payments at the beginning of each period.


      If the present value (pv) or an amount that a series is worth now is considered zero (0),
we can find the following status. We can place 1 after pmt by double coma to confirm the
payment at the beginning i.e. Annuity due

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