We're having a dispute in our company about how to calculate the PV of ending surplus for CFT purposes. Here are the 2 methods we're discussing:
Method 1:
A-T Earn(1)/(1+i)^1 + A-T Earn(2)/(1+i)^2 + ... + A-T Earn(30)/(1+i)^30
Method 2:
[A-T Earn(1) + A-T Earn(2) + A-T Earn(3) + ... + A-T Earn(30)] / (1+i)^30
Which one is right (or what should we use if both are wrong)? Is there guidance on this?
Method 1:
A-T Earn(1)/(1+i)^1 + A-T Earn(2)/(1+i)^2 + ... + A-T Earn(30)/(1+i)^30
Method 2:
[A-T Earn(1) + A-T Earn(2) + A-T Earn(3) + ... + A-T Earn(30)] / (1+i)^30
Which one is right (or what should we use if both are wrong)? Is there guidance on this?
CFT PV formula