For example, you have 10000 yuan in your hand. You keep it in the bank for a fixed period of one year. At the expiration of one year, you can get 10000 yuan plus 350 yuan's 3.5% interest, * * * * 10350 yuan. This shows that 10350 yuan after one year is equal to 10000 yuan today.
1. Discounted value, also known as present value discounted value PDV, is to convert a sum of money into present value at a certain interest rate in the future. Generally speaking, discounted value refers to converting future assets or liabilities into present value. This takes into account the time value of cash or assets at two time points. That is, the longer the time, the greater the value of the same amount of funds.
Second, the algebraic expression of discount value and stock discount value. First, for example, I'm going to deposit some money in the bank now, and the bank interest rate is 3%. I want to get back the principal and interest and 50 thousand yuan after five years, so how much should I deposit in the bank now? The money deposited now is the present value. Commonly used is the net present value, expressed by NPV. Net present value refers to the difference between the net cash flow generated by the investment scheme and the present value of the original investment discounted at the discount rate of capital cost. Net present value method is a method to evaluate the advantages and disadvantages of the scheme according to net present value. If the net present value is greater than zero, the scheme is feasible. The greater the net present value, the better the scheme and the better the investment benefit.
Three, for assets and liabilities measured only on the basis of future cash flows, the concept of present value should be:
1, in rare cases where its influence is important, is used for advance payment and advance receipt in principle;
2. It is used in construction contracts to summarize the cash flows in different periods more meaningfully;
3. It is not used to determine depreciation and amortization, because the cost of applying the present value concept will exceed its income.
Four, the discount is to meet the three main measurement objectives.
1. When the fair value cannot be directly observed from the market, estimate the fair value of a project;
2. Determine the specific individual value of an asset or liability;
3, decided to use the real interest rate of financial assets or financial liabilities of amortized cost.