Solution 11211: Differing Solutions When Computing for Future Value (FV) and Balance (BAL) in Begin (BGN) Mode Using the BA-35 Solar Financial Calculator.
In begin (BGN) mode, why do the values computed for future value (FV) differ from the values computed for balance (BAL) when using the BA-35 Solar?
When the future value (FV) of a time value of money (TVM) problem is calculated, the result is the future value at the end of a selected time period. The balance (BAL) of an amortization after a given number of payments yields the balance immediately after that payment.
For an annuity due (BGN), the future value (FV) includes interest that accrues during the last payment period. The balance (BAL) calculated for the amortization does not include this interest, therefore, there will be a difference in the FV and BAL computed values for this type of calculation.
Please see the BA-35 Solar quick reference guide for additional information.