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An annuity is explained as stream of uniform duration cash flows. The payment of life insurance premium through the policyholder to the insurance company is an illustration of an annuity. As the same, a deposit in a recurring bank account is also an annuity.
Based on the timing of the cash flows annuities are categorized as:
a) Regular Annuity or Deferred Annuity
b) Annuity Due.
The regular annuity or the deferred annuity is such annuities wherein the cash flow arises at the end of all period. In case of an annuity due the cash flow arises at the starting of the period.
How does ordinary shares and preference shares included in the account
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How to treat them both which affect the trial balance and which dont affect the trial balance
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