Annuities

2007An rente consists of a series of equal recompenses over a specified dot of epoch (Smith , Skousen , Stice Stice , 1998 . An annuity is a while of equal periodic payments made at equal time intervals for purposes of paying a loan or creating a shop . Interest payments on bonds , premiums on indemnity , payments on initiation purchases , and payments of rent argon examples of annuity . The payment intervals for the payment of annuity may be of any length , but the close to commonly used are the annual , semi-annual , quarterly , and monthly payment intervalsSimple annuity is an annuity whose payment interval is the like as the interest period . There are annuities that are fixed , meaning that the confines touch offs and ends on definite dates . periodical payment on installment purchases are called annuity authorized since the payment starts on a definite date and await regularly until the last payment . There are triad types of simple annuity namely : ordinary annuity , annuity due , and deferred annuityOrdinary annuity is one whose periodic payments are compensable at the end of each payment interval . The offset printing payment in ordinary annuity is made at the end of the first period .

annuity due , on the other hand is an annuity whose payments are due at the beginning of each payment period The first payment is due immediately at the beginning of the first period . Lastly , deferred annuity s first payment is deferred or postponed , and is to start at some future dateContingent annuity is one whose term depends on some uncertain events Many life indemnity policies are examples of contingent annuity . The earnings of life insurance policies frequently fund annuities . Policy holders of insurance or companionable security may be paid from the funds that were formal for their benefit on the deaths or other claims of other polity ownersReference Smith , J , Skousen , K .F , Stice , E Stice , J (1998 . Annuity Intermediate accounting (p 248 . South WesternPAGEPAGE 3ANNUITIES Page...If you want to get a full essay, order it on our website: Ordercustompaper.com

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