Time Value of Money – Six Functions of a Dollar
Using Assessors' Handbook Section 505 (Capitalization Formulas and Tables)
Appraisal Training: Self-Paced Online Learning Session


Welcome to the State Board of Equalization's self-paced online learning session on the Time Value of Money (commonly referred to as the six functions of a dollar). Please view the video and read the introduction below before proceeding to the lessons in the self-study session.

The purpose of this learning session is to explain the compound interest functions presented in Assessors’ Handbook Section 505, Capitalization Formulas and Tables, the key concepts of the time value of money, and its relationship to appraisal.

This learning session consists of 10 modules; each module provides discussion of the function or concept and shows practical examples of the calculation or method.

By the end of the session, you will understand:

  • The function and derivation of each of the compound interest functions presented in Assessors' Handbook Section 505
  • The appraisal application of the compound interest functions.

There are six compound interest functions presented in Assessors' Handbook Section 505:

We hope that you find the information presented in this learning session beneficial. Links to the Assessors’ Handbook Section 505 (AH 505), Capitalization Formulas and Tables are available throughout this presentation and is also available on the Board's website.

Training Credit for Certified Property Tax Appraisers

If you are a certified property tax appraiser or auditor-appraiser working for a California county assessor's office or the Board of Equalization, you can obtain training credit for taking this self-paced online learning session. If you wish to obtain training credit, you must complete the Certified Property Tax Appraisers Examination at the end of this learning session and submit your answers to the State Board of Equalization's County-Assessed Properties Division using the 'Submit' button at the end of the exam. Participants will receive eight hours of training credit.