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Time Value of Money Relationships

In accounting, the term "time value of money" is used to indicate a relationship between time and money. What is the difference in simple versus compound interest? Discuss why accountants should have an understanding of compound interest, annuities, and present value concepts. So what you can do is go over the present, future value formulas.
When revenue is realized is not always easily determined. In the normal cash for product or service exchange is easy as recognition is almost always immediate. How about when a ticket is purchased for a concert or travel for some future period? What about a long-term contract that spans multiple periods of time?

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In accounting, the term "time value of money" is used to indicate a relationship between time and money. What is the difference in simple versus compound interest? Discuss why accountants should have an understanding of compound interest, annuities, and present value concepts. So what you can do is go over the present, future value formulas.
Simple interest means ...

Solution Summary

The time value of money relationships are examined. The difference in simple versus compound interest is determined.

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