User's Manual

20060301
15-5-4
Amortization
I%' =
I%
(1+ ) –1
[C / Y ]
[P / Y ]
100 × [C / Y ]
{ }
×100
i = I%'÷100
Calculation Formulas
a
: Interest portion of payment PM1 (INT)
b
: Principal portion of payment PM1 (PRN)
c
: Principal balance upon completion of payment PM2 (BAL)
d
: Total principal paid from payment PM1 to payment PM2 (
Σ
PRN)
e
: Total interest paid from payment PM1 to payment PM2 (
Σ
INT)
•
a
+
b
= one repayment (PMT)
Converting 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 annual payments is different from the number
of annual compoundings calculation periods.
The following calculation is performed after conversion from the nominal interest rate to the
effective interest rate, and the result is used for all subsequent calculations.
1 payment
Number of Payments
1 PM1
PM2
Last............... ..................
...............
d
e
INT
PM1
= I BAL
PM1–1
× i I × (PMT sign)
PRNPM1 = PMT + BALPM1–1 × i
BALPM2 = BALPM2–1 + PRNPM2
Σ
PRN = PRNPM1 + PRNPM1+1 + .... + PRNPM2
PM2
PM1
Σ
INT = INTPM1 + INTPM1+1 + .... + INTPM2
PM2
PM1
BAL0 = PV ....................... Payment: End (Format tab)
INT1 = 0, PRN1 = PMT ... Payment: Begin (Format tab)
c
a
b
1 payment
Number of Payments
1 PM1 PM2 Last.............. ..................... ............