On December $1,2021,$ Doreen Company sold land to McKnight Company. The two companies entered into an installment sales contract at a predetermined interest rate. The contract required five equal annual payments with the first payment due on December $1,2021,$ the date of the sale. What present value concept is appropriate for this situation?

Future amount of $1$ for five periods

Present value of an annuity due of $1$ for five periods

Future amount of an annuity of $1$ for five periods

Present value of an ordinary annuity of $1$ for five periods