Explain the term 'Provident Fund' and 'Tax deduction at source' as used in payroll computation.

OR

What is the use of 'FV function ? Write and explain its syntax.

Provident fund : This is an important component of payroll and deduction category. It is a statutory deduction as part of social security. It is decided by Government under the Provident Fund Act. It is computed as a percentage of Basic Pay + Dearness Pay (if applicable). Tax deducted at source : This is also a component of payroll under deduction category. It is a statutory deduction which is deducted monthly towards income tax liability of the employee. It is essentially an appointment of yearly income tax liability over $\displaystyle 12$ months. Or Q. What is the use of…………………….. Ans. This function returns the future value of an investment based periodic, constant payment and a constant interest rate. Syntax : FV (rate, nper, pmt, pv, type) rate : Interest rate per period nper : This is the total number of payment period in an annuity pmt : This is the payment made each period; it cannot change over the life of the annuity. Typically pmt contains principal and interest but no other fees or taxes. pv : Present value type :Payment due