Microsoft Office Tutorials and References
In Depth Information
PMT
PMT PMT calculates the loan payment for a loan based on constant payments and constant interest
rates.
=PMT(rate,nper,pv,fv,type)
The PMT function is used to calculate a loan payment based on a constant interest rate. If you
take a look at Figure 6.27, you’ll notice that the rate on the loan is 12% and the total number
of payments is 36 (3 years). The present value of the loan or principal amount is -17,900
and the future value of the loan after it’s paid off is 0. As indicated in the Type column, the
payment timing is 1 or at the beginning of the period.
The interest rate of the loan.
RATE
The number of total payments.
NPER
The present value or the principal amount.
PV
The future value or cash balance you want to attain upon the last payment—
for a loan it would be zero.
FV
The payment timing—when the payments are due.
TYPE
Figure 6.27
Calculate the loan
payment for a loan
based on constant
payments and constant
interest rates using the
PMT function.
A
The function
built with cell
referencing
PPM PPMT returns the principal payment for a period of an investment based on periodic constant
payments and a constant interest rate.
=PPMT(rate,per,nper,pv,fv,type)
The PPMT function is used to calculate a principal payment based on a constant interest rate
and constant payments for a set period. As you see in Figure 6.28, the rate of the loan is 12%.
The period is 4 or the fourth month, and the total number of payments is 36 (3 years). The
principal amount of the loan is -$17,900. The future value after the loan is paid off would be 0,
and the type or timing is 1 (at the beginning of the period).
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