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Annuity table OR Present value table

Forums › ACCA Forums › ACCA AFM Advanced Financial Management Forums › Annuity table OR Present value table

  • This topic has 1 reply, 2 voices, and was last updated 11 years ago by John Moffat.
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  • October 30, 2013 at 6:12 pm #144167
    khizer03
    Member
    • Topics: 4
    • Replies: 0
    • ☆

    Hello friends,

    Can someone advise me as to when we should look up the annuity table and when to look up the PV table.
    During the APV calculation , the tax benefit was discounted by look up at the annuity table NOT the usual PV table

    i am kind of confused because in the usual NPV calculation with cashflows for say 3 years we use the PV table ( the first given table ) not Annuity table

    i hope i make sense. Awaiting some feedback to clarify my doubt

    Cheers

    October 30, 2013 at 10:13 pm #144175
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54679
    • ☆☆☆☆☆

    You use the present value table to discount individual cash flows.

    You use the annuity tables when there is an equal cash flow each year for several years (only because it is quicker than discounting each year separately, which would give the same result)

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