JM Read discussion post below, and write a PHD level response. Be sure to include at least two APA-formatted citation (in-text plus full reference). The citation may be from course textbooks, assigned readings, or an outside source. Your initial post must be a minimum of 150 words in length. Present value signifies the sum of money, in difference to the approximate future value it will have when it has been capitalized at compound interest (Zelman, et al., 2014). The calculations in the spreadsheet shows the present value represented as $120,000 and factors in various discount rates for 5 years. Future cash flows are discounted at a specific rate and the higher the rate the lower the present value of future cash flow (McMath, 2000). Future value is associated with present value because it can direct the duration and potential risk to revenue Therefore, the discount rate is the amount of time that it takes to increase future value in nominal or absolute terms (McMath, 2000). The four equations show the perceived amount of their worth today compared to work in the future. Let’s assume an organization would like to accomplish a standard future value as $120,000 in the next five years the entity must recognize the present value factor. Calculating the present value factor by the today’s value per dollar received at a future date and then use this to calculate the amount larger than a dollar by multiplying the present value by the amount received at a future date (Zelman, et al., 2014). This calculation will provide the organization with the present value factor. If the factor is 3% for 5 years the present value equals $103,513. If its 6% for those same 5 years the present value equals $89,671. Assuming the rate is 9% the present value is $77,992 and if the rate is 12% then the present value is 68,091 with the future value of $120,000. McMath, H. K. (2000). On the correct calculation of present value-based measurements in accounting. Journal of Accounting Education, 18(1), 51. Zelman, W. N., McCue, M. J., Glick, N. D., & Thomas, M. S. (2014). Financial management of health care organizations: An introduction to fundamental tools, concepts, and applications (4th ed.). San Francisco, CA: Jossey-Bass. Summary Notes: Present value the current value of an investment Present value indicates the current value of future dollars Present value of one dollar represents today's value of a sum of A dollar in the future is worth less than a dollar today because a Present Value=Future Value x Present Value Factor or stated as Table B-3 Present value factor of $1. PVF(i,n) = 1/(1 + i)n ; PV = FV(PVFi,n) Problem 6-19 CFO investment A a) b) c) d) Period 0.01 0.02 0.03 $1.00 99% 98% 97% B C D 2 0.9803 0.9612 0.9426 Present Present Present 3 0.9706 0.9423 0.9151 Future Value Value Value 4 0.9610 0.9238 0.8885 Value Factor Factor [AxC] 5 0.9515 0.9057 0.8626 $120,000 $120,000 $120,000 $120,000 PVF3,5 0.8626 0.7473 0.6499 0.5674 $103,513 6 0.9420 0.8880 0.8375 $89,671 7 0.9327 0.8706 0.8131 $77,992 8 0.9235 0.8535 0.7894 $68,091 9 0.9143 0.8368 0.7664 10 0.9053 0.8203 0.7441 11 0.8963 0.8043 0.7224 12 0.8874 0.7885 0.7014 13 0.8787 0.7730 0.6810 14 0.8700 0.7579 0.6611 15 0.8613 0.7430 0.6419 16 0.8528 0.7284 0.6232 17 0.8444 0.7142 0.6050 18 0.8360 0.7002 0.5874 19 0.8277 0.6864 0.5703 20 0.8195 0.6730 0.5537 21 0.8114 0.6598 0.5375 22 0.8034 0.6468 0.5219 23 0.7954 0.6342 0.5067 24 0.7876 0.6217 0.4919 25 0.7798 0.6095 0.4776 26 0.7720 0.5976 0.4637 27 0.7644 0.5859 0.4502 28 0.7568 0.5744 0.4371 29 0.7493 0.5631 0.4243 30 0.7419 0.5521 0.4120 35 0.7059 0.5000 0.3554 40 0.6717 0.4529 0.3066 45 0.6391 0.4102 0.2644 50 0.6080 0.3715 0.2281 0.1600 0.1700 0.1800 $1.00 86% 85% 85% 2 0.7432 0.7305 0.7182 3 0.6407 0.6244 0.6086 4 0.5523 0.5337 0.5158 5 0.4761 0.4561 0.4371 6 0.4104 0.3898 0.3704 7 0.3538 0.3332 0.3139 8 0.3050 0.2848 0.2660 9 0.2630 0.2434 0.2255 PVF6,5 PVF9,5 PVF12,5 Period 10 0.2267 0.2080 0.1911 11 0.1954 0.1778 0.1619 12 0.1685 0.1520 0.1372 13 0.1452 0.1299 0.1163 14 0.1252 0.1110 0.0985 15 0.1079 0.0949 0.0835 16 0.0930 0.0811 0.0708 17 0.0802 0.0693 0.0600 18 0.0691 0.0592 0.0508 19 0.0596 0.0506 0.0431 20 0.0514 0.0433 0.0365 21 0.0443 0.0370 0.0309 22 0.0382 0.0316 0.0262 23 0.0329 0.0270 0.0222 24 0.0284 0.0231 0.0188 25 0.0245 0.0197 0.0160 26 0.0211 0.0169 0.0135 27 0.0182 0.0144 0.0115 28 0.0157 0.0123 0.0097 29 0.0135 0.0105 0.0082 30 0.0116 0.0090 0.0070 35 0.0055 0.0041 0.0030 40 0.0026 0.0019 0.0013 45 0.0013 0.0009 0.0006 50 0.0006 0.0004 0.0003 sents today's value of a sum of money to be received in the future, if money is invested at a given interest rate. s than a dollar today because a dollar today can be invested and has the potential to grow to more than a dollar received in the future. PVFi,n 0.04 0.05 0.06 0.07 0.08 0.09 0.1 0.11 0.12 96% 95% 94% 93% 93% 92% 91% 90% 89% 0.9246 0.9070 0.8900 0.8734 0.8573 0.8417 0.8264 0.8116 0.7972 0.8890 0.8638 0.8396 0.8163 0.7938 0.7722 0.7513 0.7312 0.7118 0.8548 0.8227 0.7921 0.7629 0.7350 0.7084 0.6830 0.6587 0.6355 0.8219 0.7835 0.7473 0.7130 0.6806 0.6499 0.6209 0.5935 0.5674 0.7903 0.7462 0.7050 0.6663 0.6302 0.5963 0.5645 0.5346 0.5066 0.7599 0.7107 0.6651 0.6227 0.5835 0.5470 0.5132 0.4817 0.4523 0.7307 0.6768 0.6274 0.5820 0.5403 0.5019 0.4665 0.4339 0.4039 0.7026 0.6446 0.5919 0.5439 0.5002 0.4604 0.4241 0.3909 0.3606 0.6756 0.6139 0.5584 0.5083 0.4632 0.4224 0.3855 0.3522 0.3220 0.6496 0.5847 0.5268 0.4751 0.4289 0.3875 0.3505 0.3173 0.2875 0.6246 0.5568 0.4970 0.4440 0.3971 0.3555 0.3186 0.2858 0.2567 0.6006 0.5303 0.4688 0.4150 0.3677 0.3262 0.2897 0.2575 0.2292 0.5775 0.5051 0.4423 0.3878 0.3405 0.2992 0.2633 0.2320 0.2046 0.5553 0.4810 0.4173 0.3624 0.3152 0.2745 0.2394 0.2090 0.1827 0.5339 0.4581 0.3936 0.3387 0.2919 0.2519 0.2176 0.1883 0.1631 0.5134 0.4363 0.3714 0.3166 0.2703 0.2311 0.1978 0.1696 0.1456 0.4936 0.4155 0.3503 0.2959 0.2502 0.2120 0.1799 0.1528 0.1300 0.4746 0.3957 0.3305 0.2765 0.2317 0.1945 0.1635 0.1377 0.1161 0.4564 0.3769 0.3118 0.2584 0.2145 0.1784 0.1486 0.1240 0.1037 0.4388 0.3589 0.2942 0.2415 0.1987 0.1637 0.1351 0.1117 0.0926 0.4220 0.3418 0.2775 0.2257 0.1839 0.1502 0.1228 0.1007 0.0826 0.4057 0.3256 0.2618 0.2109 0.1703 0.1378 0.1117 0.0907 0.0738 0.3901 0.3101 0.2470 0.1971 0.1577 0.1264 0.1015 0.0817 0.0659 0.3751 0.2953 0.2330 0.1842 0.1460 0.1160 0.0923 0.0736 0.0588 0.3607 0.2812 0.2198 0.1722 0.1352 0.1064 0.0839 0.0663 0.0525 0.3468 0.2678 0.2074 0.1609 0.1252 0.0976 0.0763 0.0597 0.0469 0.3335 0.2551 0.1956 0.1504 0.1159 0.0895 0.0693 0.0538 0.0419 0.3207 0.2429 0.1846 0.1406 0.1073 0.0822 0.0630 0.0485 0.0374 0.3083 0.2314 0.1741 0.1314 0.0994 0.0754 0.0573 0.0437 0.0334 0.2534 0.1813 0.1301 0.0937 0.0676 0.0490 0.0356 0.0259 0.0189 0.2083 0.1420 0.0972 0.0668 0.0460 0.0318 0.0221 0.0154 0.0107 0.1712 0.1113 0.0727 0.0476 0.0313 0.0207 0.0137 0.0091 0.0061 0.1407 0.0872 0.0543 0.0339 0.0213 0.0134 0.0085 0.0054 0.0035 0.1900 0.2000 0.2100 0.2200 0.2300 0.2400 0.2500 0.3000 0.3500 84% 83% 83% 82% 81% 81% 80% 77% 74% 0.7062 0.6944 0.6830 0.6719 0.6610 0.6504 0.6400 0.5917 0.5487 0.5934 0.5787 0.5645 0.5507 0.5374 0.5245 0.5120 0.4552 0.4064 0.4987 0.4823 0.4665 0.4514 0.4369 0.4230 0.4096 0.3501 0.3011 0.4190 0.4019 0.3855 0.3700 0.3552 0.3411 0.3277 0.2693 0.2230 0.3521 0.3349 0.3186 0.3033 0.2888 0.2751 0.2621 0.2072 0.1652 0.2959 0.2791 0.2633 0.2486 0.2348 0.2218 0.2097 0.1594 0.1224 0.2487 0.2326 0.2176 0.2038 0.1909 0.1789 0.1678 0.1226 0.0906 0.2090 0.1938 0.1799 0.1670 0.1552 0.1443 0.1342 0.0943 0.0671 0.1756 0.1615 0.1486 0.1369 0.1262 0.1164 0.1074 0.0725 0.0497 0.1476 0.1346 0.1228 0.1122 0.1026 0.0938 0.0859 0.0558 0.0368 0.1240 0.1122 0.1015 0.0920 0.0834 0.0757 0.0687 0.0429 0.0273 0.1042 0.0935 0.0839 0.0754 0.0678 0.0610 0.0550 0.0330 0.0202 0.0876 0.0779 0.0693 0.0618 0.0551 0.0492 0.0440 0.0254 0.0150 0.0736 0.0649 0.0573 0.0507 0.0448 0.0397 0.0352 0.0195 0.0111 0.0618 0.0541 0.0474 0.0415 0.0364 0.0320 0.0281 0.0150 0.0082 0.0520 0.0451 0.0391 0.0340 0.0296 0.0258 0.0225 0.0116 0.0061 0.0437 0.0376 0.0323 0.0279 0.0241 0.0208 0.0180 0.0089 0.0045 0.0367 0.0313 0.0267 0.0229 0.0196 0.0168 0.0144 0.0068 0.0033 0.0308 0.0261 0.0221 0.0187 0.0159 0.0135 0.0115 0.0053 0.0025 0.0259 0.0217 0.0183 0.0154 0.0129 0.0109 0.0092 0.0040 0.0018 0.0218 0.0181 0.0151 0.0126 0.0105 0.0088 0.0074 0.0031 0.0014 0.0183 0.0151 0.0125 0.0103 0.0086 0.0071 0.0059 0.0024 0.0010 0.0154 0.0126 0.0103 0.0085 0.0070 0.0057 0.0047 0.0018 0.0007 0.0129 0.0105 0.0085 0.0069 0.0057 0.0046 0.0038 0.0014 0.0006 0.0109 0.0087 0.0070 0.0057 0.0046 0.0037 0.0030 0.0011 0.0004 0.0091 0.0073 0.0058 0.0047 0.0037 0.0030 0.0024 0.0008 0.0003 0.0077 0.0061 0.0048 0.0038 0.0030 0.0024 0.0019 0.0006 0.0002 0.0064 0.0051 0.0040 0.0031 0.0025 0.0020 0.0015 0.0005 0.0002 0.0054 0.0042 0.0033 0.0026 0.0020 0.0016 0.0012 0.0004 0.0001 0.0023 0.0017 0.0013 0.0009 0.0007 0.0005 0.0004 0.0001 0.0000 0.0010 0.0007 0.0005 0.0004 0.0003 0.0002 0.0001 0.0000 0.0000 0.0004 0.0003 0.0002 0.0001 0.0001 0.0001 0.0000 0.0000 0.0000 0.0002 0.0001 0.0001 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.13 0.14 0.15 88% 88% 87% 0.7831 0.7695 0.7561 0.6931 0.6750 0.6575 0.6133 0.5921 0.5718 0.5428 0.5194 0.4972 0.4803 0.4556 0.4323 0.4251 0.3996 0.3759 0.3762 0.3506 0.3269 0.3329 0.3075 0.2843 0.2946 0.2697 0.2472 0.2607 0.2366 0.2149 0.2307 0.2076 0.1869 0.2042 0.1821 0.1625 0.1807 0.1597 0.1413 0.1599 0.1401 0.1229 0.1415 0.1229 0.1069 0.1252 0.1078 0.0929 0.1108 0.0946 0.0808 0.0981 0.0829 0.0703 0.0868 0.0728 0.0611 0.0768 0.0638 0.0531 0.0680 0.0560 0.0462 0.0601 0.0491 0.0402 0.0532 0.0431 0.0349 0.0471 0.0378 0.0304 0.0417 0.0331 0.0264 0.0369 0.0291 0.0230 0.0326 0.0255 0.0200 0.0289 0.0224 0.0174 0.0256 0.0196 0.0151 0.0139 0.0102 0.0075 0.0075 0.0053 0.0037 0.0041 0.0027 0.0019 0.0022 0.0014 0.0009 0.4000 0.4500 0.5000 71% 69% 67% 0.5102 0.4756 0.4444 0.3644 0.3280 0.2963 0.2603 0.2262 0.1975 0.1859 0.1560 0.1317 0.1328 0.1076 0.0878 0.0949 0.0742 0.0585 0.0678 0.0512 0.0390 0.0484 0.0353 0.0260 0.0346 0.0243 0.0173 0.0247 0.0168 0.0116 0.0176 0.0116 0.0077 0.0126 0.0080 0.0051 0.0090 0.0055 0.0034 0.0064 0.0038 0.0023 0.0046 0.0026 0.0015 0.0033 0.0018 0.0010 0.0023 0.0012 0.0007 0.0017 0.0009 0.0005 0.0012 0.0006 0.0003 0.0009 0.0004 0.0002 0.0006 0.0003 0.0001 0.0004 0.0002 0.0001 0.0003 0.0001 0.0001 0.0002 0.0001 0.0000 0.0002 0.0001 0.0000 0.0001 0.0000 0.0000 0.0001 0.0000 0.0000 0.0001 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000
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