# Annual Basis

The definition of ‘annually’

Period an annual basis has several applications in Finance. In every sense, it refers to the observed figures during the year. It can also refer to something that happens every year.

An annual basis can refer to the return earned by the investments during the year. Projections that contain the phrase “on an annual basis”, usually used for less than a year to project full-year returns. Annually can also refer to the cost of something during the year.

Breaking down ‘annually’

The investment could come back in one month 1.5%. By multiplying this back by 12, by 18% annually-is the result. The shorter the period of data used to determine annual income, the less accurate projection of what is likely to be. Allegations that the investment return on an annual basis always appreciates.

An example of an annual basis

For example, if Angela wanted to create a family budget for the year, and it was April 1, she can see how much money her family spent on food in January, February and March to assess her family’s expenditure on food will be on an annual basis. She sees that she spent \$300 in January, \$250 In February and \$350 in March, for a total of \$900. With 25% of a year has passed, she multiplies \$900 x 4 to determine that the products should cost her family about \$3,600 on an annual basis.