Microsoft Office Tutorials and References
In Depth Information
Figuring Loan Calculations
5. Enter /12 to divide the annual interest rate to get the monthly
interest rate.
6. Enter a comma ( ,).
7. Click the cell where you entered the principal, or just enter the cell
address.
8. Enter a comma ( ,).
9. Click the cell where you entered the payback amount, or just enter the
cell address.
10. Type a ), and press Enter.
Figure 5-6 shows how I set up a worksheet with values and used the
PDURATION function to find out how many payments are necessary to pay
off a loan. In this example, we assume that the amount paid off is $4400
(includes principal and interest). The amount borrowed is $4,000, and the
annual interest rate is 6 percent.
The number of payments is 22.92, so I’ll call that 23 payments, just under 2 years.
Figure 5-6:
The
PDURATION
function
calculates
the number
of payments
for a loan.
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