| Annuities and Sinking Funds
Learning Objectives
Note: A complete set of plastic overlays showing the concept of annuities is found at the end of the chapter.
LU 13–1: Annuities: Ordinary Annuity and Annuity Due (Find Future Value)- Differentiate between contingent annuities and annuities certain.
- Calculate the future value of an ordinary annuity and an annuity due manually and by table lookup.
LU 13–2: Present Value of an Ordinary Annuity (Find Present Value)- Calculate the present value of an ordinary annuity by table lookup and manually check the calculation.
- Compare the calculation of the present value of one lump sum versus the present value of an ordinary annuity.
LU 13–3: Sinking Funds (Find Periodic Payments)- Calculate the payment made at the end of each period by table lookup.
- Check table lookup by using ordinary annuity table.
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