PRESENT VALUE Definition

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PRESENT VALUE is the discounted value of a payment or stream of payments to be received in the future, taking into consideration a specific interest or discount rate. Present Value represents a series of future cash flows expressed in todays dollars. A given amount of money is almost always more valuable sooner than later, so present values are generally smaller than corresponding future values.

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ACCRUAL ACCOUNTING see ACCRUAL BASIS OF ACCOUNTING.

WIP is an acronym for Work in Process/Progress. Usually refers to inventory that has value added from labor or additional processing. When considered for inventory value, the value of the raw material plus the value added component is accounted for in determining the value of that inventory at that point in the process.

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