New Feature: Playlist Center! Pick a topic and let our playlists guide the way.

Start learning with our library of video tutorials taught by experts. Get started

Excel 2010: Financial Functions in Depth
Illustration by

ACCRINT and ACCRINTM: Calculating accrued interest for investments


From:

Excel 2010: Financial Functions in Depth

with Curt Frye

Video: ACCRINT and ACCRINTM: Calculating accrued interest for investments

When you invest in a security that pays interest, you can receive your interest payments in one of two ways: either periodically or all at once when the security matures. Excel has a function for each of these cases. The ACCRINT function lets you find accrued Interest that's paid periodically, and of the ACCRINTM function calculates interest that's paid in a lump sum when the security matures. You can remember the difference between the two functions by remembering that the M at the end stands for at maturity.
Expand all | Collapse all
  1. 2m 11s
    1. Welcome
      1m 6s
    2. Using the exercise files
      36s
    3. Disclaimer
      29s
  2. 28m 32s
    1. PMT: Calculating a loan payment
      3m 31s
    2. PPMT and IPMT: Calculating principal and interest per loan payment
      4m 18s
    3. CUMPRINC and CUMIPMT: Calculating cumulative principal and interest paid between periods
      4m 30s
    4. ISPMT: Calculating interest paid during a specific period
      2m 13s
    5. EFFECT and NOMINAL: Finding nominal and effective interest rates
      3m 31s
    6. ACCRINT and ACCRINTM: Calculating accrued interest for investments
      4m 15s
    7. RATE: Discovering the interest rate of an annuity
      2m 41s
    8. NPER: Calculating the number of periods in an investment
      3m 33s
  3. 19m 5s
    1. SLN: Calculating depreciation using the straight-line method
      1m 48s
    2. DB: Calculating depreciation using the declining balance method
      3m 10s
    3. DDB: Calculating depreciation using the double-declining balance method
      3m 20s
    4. SYD: Calculating depreciation for a specified period
      2m 13s
    5. VDB: Calculating declining balance depreciation for a partial period
      3m 24s
    6. AMORDEGRC: Calculating depreciation using a depreciation coefficient
      2m 27s
    7. AMORLINC: Calculating depreciation for each accounting period
      2m 43s
  4. 22m 33s
    1. FV: Calculating the future value of an investment
      2m 48s
    2. FVSCHEDULE: Calculating the future value of an investment with variable returns
      2m 21s
    3. PV: Calculating the present value of an investment
      2m 6s
    4. NPV: Calculating the net present value of an investment
      3m 17s
    5. IRR: Calculating internal rate of return
      2m 33s
    6. XNPV: Calculating net present value given irregular inputs
      2m 32s
    7. XIRR: Calculating internal rate of return for irregular cash flows
      1m 48s
    8. MIRR: Calculating internal rate of return for mixed cash flows
      2m 2s
    9. DISC: Calculating the discount rate of a security
      3m 6s
  5. 24m 12s
    1. COUPDAYBS: Calculating total days between coupon beginning and settlement
      3m 2s
    2. COUPDAYS: Calculating days in the settlement date's coupon period
      2m 48s
    3. COUPDAYSNC: Calculating days from the settlement date to the next coupon date
      3m 1s
    4. COUPNCD: Calculating the next coupon date after the settlement date
      2m 43s
    5. COUPNUM: Calculating the number of coupons between settlement and maturity
      2m 55s
    6. COUPPCD: Calculating the date of a coupon due immediately before settlement
      3m 4s
    7. DURATION: Calculating the annual duration of a security
      3m 20s
    8. MDURATION: Calculating the duration of a security using the modified Macauley method
      3m 19s
  6. 28m 43s
    1. DOLLARDE and DOLLARFR: Converting between fractional prices and decimal prices
      2m 36s
    2. INTRATE: Calculating the interest rate of a fully invested security
      2m 50s
    3. RECEIVED: Calculating the value at maturity of a fully invested security
      2m 46s
    4. PRICE: Calculating the price of a security that pays periodic interest
      3m 19s
    5. PRICEDISC: Calculating the price of a discounted security
      2m 48s
    6. PRICEMAT: Calculating the price of a security that pays interest at maturity
      1m 57s
    7. TBILLEQ: Calculating the bond-equivalent yield for a Treasury bill
      1m 50s
    8. TBILLPRICE: Calculating the price for a Treasury bill
      1m 31s
    9. TBILLYIELD: Calculating the yield of a Treasury bill
      1m 41s
    10. YIELD: Calculating the yield of a security that pays periodic interest
      2m 59s
    11. YIELDDISC: Calculating the annual yield for a discounted security
      2m 9s
    12. YIELDMAT: Calculating the annual yield of a security that pays interest at maturity
      2m 17s
  7. 12m 1s
    1. ODDFPRICE: Calculating the price of a security with an odd first period
      3m 17s
    2. ODDFYIELD: Calculating the yield of a security with an odd first period
      3m 3s
    3. ODDLPRICE: Calculating the price of a security with an odd last period
      2m 44s
    4. ODDLYIELD: Calculating the yield of a security with an odd last period
      2m 57s
  8. 1m 5s
    1. Additional resources
      1m 5s

Watch this entire course now—plus get access to every course in the library. Each course includes high-quality videos taught by expert instructors.

Become a member
please wait ...
Excel 2010: Financial Functions in Depth
2h 18m Intermediate Jun 28, 2011

Viewers: in countries Watching now:

In this course, author Curt Frye shows how to perform a wide range of financial calculations quickly and easily using the many financial functions found in Excel 2010. The course details dozens of functions for evaluating cash flows; calculating depreciation; determining rates of return, bond coupon dates, and security durations; and more.

Topics include:
  • Analyzing loans, payments, and interest
  • Discovering the interest rate of an annuity
  • Determining depreciation using the straight line, declining balance, double-declining balance, and other methods
  • Calculating the future value of an investment with variable returns
  • Finding the discount rate of a security
  • Converting between fractional prices and decimal prices
  • Determining the yield of securities that pay interest periodically
Subjects:
Business Finance
Software:
Excel Office
Author:
Curt Frye

ACCRINT and ACCRINTM: Calculating accrued interest for investments

When you invest in a security that pays interest, you can receive your interest payments in one of two ways: either periodically or all at once when the security matures. Excel has a function for each of these cases. The ACCRINT function lets you find accrued Interest that's paid periodically, and of the ACCRINTM function calculates interest that's paid in a lump sum when the security matures. You can remember the difference between the two functions by remembering that the M at the end stands for at maturity.

In this workbook, I have two worksheets, one for periodic interest calculation and the other for calculating interest at maturity. On the Periodic worksheet, I have all of the arguments I need to calculate accrued interest that's paid periodically. So for example, I have the Issue Date, which is the date the security is first issued, not the date that you bought it. Then we have the First Interest Date and that is the date that it first pays interest to its investors. Settlement Date, that's the date you bought it, and then the Annual Rate, which is the annual rate that the investment pays.

Par Value is the face value of the investment and that's listed in the prospectus. Frequency is the number of payments per month. That can either be 1, 2, or 4, so annual, semiannual, or quarterly. Then we have Basis and a basis is the number of days in a month and in a year. So for example, some accounting systems use 30-day months and assumed a 360-day year. Others use actual days and so on.

Basically, you're going to have to know which one you're using based on your jurisdiction's accounting rules. And then finally, we have the Calculation method. The calculation method can either be true or false. If it is true, then Excel starts calculating interest from the issue date to the settlement date. If you set it to false, then it calculates interest from the settlement date to the first interest date. In most cases the value will be true and again that's something you'll just have to know. So let's go ahead and create our first formula.

So we're in cell C12, type =ACCRINT for accrued interest, and then a left parenthesis, and then the issue date is in C3, first interest date is in C4, type a comma, then we have the settlement date in C5, comma, annual rate is in cell C6, comma, par value C7, comma, then we have our frequency which is quarterly, that's in cell C8, comma, the basis we'll use the standard US which is 30-day months and 360 day a year, that's in cell C9, and then our calculation method, we're going to use the default which is true. That is in cell C10. Type a right parenthesis.

Take a quick look to make sure I haven't mistyped any numbers. Everything appears to be correct and press Enter. When we do, we see that the accrued interest paid quarterly will be $66.67. Now let's switch over to the At Maturity worksheet by clicking its sheet tab and you'll see that the calculation is a bit simpler. That's because we only need to know the interest that accumulates throughout the life of the investment. So here we have the Issue Date, the Settlement Date, the Annual Rate, the Par Value, and the Basis.

So in cell C10, type =ACCRINTM because we're calculating interest at maturity. Then a left parenthesis and we have the issue date which is C3, settlement date C4, comma, and then the annual rate is in C5, comma,par value C6, comma, and the basis is in cell C7. So I type a right parenthesis. Quick look, everything is right, and I'm going to press the Tab key so I don't scroll down.

And when we do, we see that the interest at maturity is $800 and that makes sense. There is a $10,000 investment at an annual rate of 4% over two years. Depending upon when you receive interest on an investment, whether it's periodically or when the investment matures, you can use these functions in Excel to calculate how much you're due and when.

Find answers to the most frequently asked questions about Excel 2010: Financial Functions in Depth.


Expand all | Collapse all
please wait ...
Q: Where can I learn more about Excel formulas?
A: Discover more on this topic by visiting Excel formulas on lynda.com.
 
Share a link to this course

What are exercise files?

Exercise files are the same files the author uses in the course. Save time by downloading the author's files instead of setting up your own files, and learn by following along with the instructor.

Can I take this course without the exercise files?

Yes! If you decide you would like the exercise files later, you can upgrade to a premium account any time.

Become a member Download sample files See plans and pricing

Please wait... please wait ...
Upgrade to get access to exercise files.

Exercise files video

How to use exercise files.

Learn by watching, listening, and doing, Exercise files are the same files the author uses in the course, so you can download them and follow along Premium memberships include access to all exercise files in the library.
Upgrade now


Exercise files

Exercise files video

How to use exercise files.

For additional information on downloading and using exercise files, watch our instructional video or read the instructions in the FAQ.

This course includes free exercise files, so you can practice while you watch the course. To access all the exercise files in our library, become a Premium Member.

join now Upgrade now

Are you sure you want to mark all the videos in this course as unwatched?

This will not affect your course history, your reports, or your certificates of completion for this course.


Mark all as unwatched Cancel

Congratulations

You have completed Excel 2010: Financial Functions in Depth.

Return to your organization's learning portal to continue training, or close this page.


OK
Become a member to add this course to a playlist

Join today and get unlimited access to the entire library of video courses—and create as many playlists as you like.

Get started

Already a member?

Become a member to like this course.

Join today and get unlimited access to the entire library of video courses.

Get started

Already a member?

Exercise files

Learn by watching, listening, and doing! Exercise files are the same files the author uses in the course, so you can download them and follow along. Exercise files are available with all Premium memberships. Learn more

Get started

Already a Premium member?

Exercise files video

How to use exercise files.

Ask a question

Thanks for contacting us.
You’ll hear from our Customer Service team within 24 hours.

Please enter the text shown below:

The classic layout automatically defaults to the latest Flash Player.

To choose a different player, hold the cursor over your name at the top right of any lynda.com page and choose Site preferencesfrom the dropdown menu.

Continue to classic layout Stay on new layout
Exercise files

Access exercise files from a button right under the course name.

Mark videos as unwatched

Remove icons showing you already watched videos if you want to start over.

Control your viewing experience

Make the video wide, narrow, full-screen, or pop the player out of the page into its own window.

Interactive transcripts

Click on text in the transcript to jump to that spot in the video. As the video plays, the relevant spot in the transcript will be highlighted.

Are you sure you want to delete this note?

No

Thanks for signing up.

We’ll send you a confirmation email shortly.


Sign up and receive emails about lynda.com and our online training library:

Here’s our privacy policy with more details about how we handle your information.

Keep up with news, tips, and latest courses with emails from lynda.com.

Sign up and receive emails about lynda.com and our online training library:

Here’s our privacy policy with more details about how we handle your information.

   
submit Lightbox submit clicked
Terms and conditions of use

We've updated our terms and conditions (now called terms of service).Go
Review and accept our updated terms of service.