User manual - financial

13
5. Amortization
This calculator can be used to calculate the principal and interest portion of a monthly installment,
the remaining principal, and amount of principal and interest repaid up to any point.
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uFormula
b
a
d
e
c
12 mn
a: interest portion of installment PM1 (INT)
b: principal portion of installment PM1 (PRN)
c: balance of principal after installment PM2 (BAL)
d: total principal from installment PM1 to payment of installment PM2 (ΣPRN)
e: total interest from installment PM1 to payment of installment PM2 (ΣINT)
*a + b = one repayment (PMT)
a : INT PM1 = I BAL PM1–1 × i I × (PMT sign)
b : PRN
PM1 = PMT + BAL PM1–1 × i
c : BAL
PM2 = BAL PM2–1 + PRN PM2
d :
Σ
PRN = PRN PM1 + PRN PM1+1 + … + PRN PM2
e :
Σ
INT = INT PM1 + INT PM1+1 + … + INT PM2
PM2
PM1
PM2
PM1
BAL0 = PV (INT1 = 0 and PRN1 = PMT at beginning of installment term)
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uConverting between the nominal interest rate and effective interest rate
The nominal interest rate (I% value input by user) is converted to an effective interest rate (I%')
for installment loans where the number of installments per year is different from the number of
compound interest calculation periods.
I%' =
I%
(1+ ) –1
[C / Y ]
[P / Y ]
100 × [C / Y ]
{ }
×100
(Number of payments)
Amount of single payment