2: TVM and Amortization Worksheets 41
Example: Present Value of Cost Savings (cont.)
Procedure Keystrokes Display
Set all variables to defaults.
&
}
!
RST 0.00
Set payments per year to 1.
&
[
1
!
P/Y= 1.00
Return to calculator mode.
&
U
0.00
Enter number of payments.
10
,
N= 10.00
Enter interest rate per
payment period.
10
-
I/Y= 10.00
Enter payment.
20000
S
/
PMT= -20,000.00
Compute PV for an ordinary
annuity.
%
.
PV= 122,891.34
…
Set beginning-of-period
payments.
&
]
&
V
BGN
Return to calculator mode.
&
U
0.00
Compute PV for annuity due.
%
.
PV= 135,180.48
…
The present value is $122,891.34 with an ordinary annuity and
$135,180.48 with an annuity due.
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