When you take out a loan, you or your accountant might need to know how much interest you paid for a given period. If you borrow $250,000 for some facility upgrades, you might be able to write off some or all of the interest paid for a given month, quarter, or year. You can discover how much interest you paid on a loan by using the ISPMT function.
- When you take out a loan,…you or your accountant might need to know…how much interest you paid for a given period.…If you borrow $500,000 for some facility upgrades,…for example, you might be able to write off some…or all of the interest paid for a given month,…quarter, or year.…You can discover how much interest you paid…on a loan by using the ISPMT function.…My sample file is InterestInPeriod_01_04…and you can find it in the chapter 1 folder…of your exercise files collection.…
Like I said, I want to calculate the interest…that was generated by an investment, or in this case,…that I need to pay for a loan that I took out.…I need to know several different pieces of information.…The first is the interest rate that my bank is charging me.…That's here in C3.…Next is the period, that is, which payment within the loan…I'm calculating the interest for.…That's in C4.…In C5, I have the total number of periods.…In this case, 36, which for a monthly loan…would be three years.…
And then the present value, or the amount that I borrowed,…
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10/9/2016- Recall what the type argument is used to determine when using the PMT function.
- Identify what the M stands for in the ACCRINTM function.
- Name the accounting rules used by the AMORDEGRC function to assign a depreciation coefficient to an asset.
- Recall what internal rate of return generated by the IRR function should be measured against to determine if it is a good investment.
- List the three regular intervals that coupon bonds pay interest at.
- Determine the function that provides a more conservative bond evaluation compared to the DURATION function.
- Explain what the RECEIVED function shows.
Skill Level Intermediate
Duration
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Related Courses
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Introduction
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Welcome58s
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1. Analyzing Loans, Payments, and Interest
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2. Calculating Depreciation
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3. Determining Values and Rates of Return
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4. Calculating Bond Coupon Dates and Security Durations
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5. Calculating Security Prices and Yields
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6. Analyzing Simulation Results
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Conclusion
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Next steps1m 12s
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Video: Calculating the interest paid during a specific period (ISPMT)