Most loans, whether between businesses or made by businesses to individual…borrowers, are fully amortized.…Fully amortized means that the monthly payments made over the term of the loan…pay off the principal and all accrued interest.…You can calculate the monthly payments required to pay off a fully amortized…loan using the PMT function.…PMT is short for payment.…The PMT function has five arguments: rate, number of periods, present value,…future value and a type.…The first three arguments, rate, numbers of periods and present value are required.…
I'll type in PMT and left parentheses to show you the arguments in the…order that they occur.…Rate is the annual percentage rate divided by the number of payments made each year,…usually 12 representing the 12 months.…So, if I were to type in the rate or in this case the address of the cell…that contains the rate, I would type in B5 divided by 12. Again this is monthly payments.…So there are 12 months per year.…I have to divide the rate by 12 to turn it into a monthly rate.…
Author
Released
6/16/2010- Tracking income and expenses by category and contract
- Using balance sheets
- Designing worksheets to assist decision making
- Creating income statements
- Calculating loans payments and interest
- Creating cell references to other worksheets
- Summarizing data in a chart
- Building alternative budget scenarios
Skill Level Intermediate
Duration
Views
Related Courses
-
Excel 2007: Financial Analysis
with Curt Frye2h 18m Intermediate -
Excel 2007: Introduction to Formulas and Functions
with Curt Frye2h 26m Intermediate -
Excel 2007: Business Statistics
with Curt Frye4h 19m Intermediate
-
Introduction
-
Welcome1m 1s
-
-
1. Managing Cash on Hand
-
2. Calculating Loan Repayments
-
3. Budgeting Using Financial Statements
-
4. Managing Budgets
-
5. Defining Alternative Budget Scenarios
-
Summarizing scenarios2m 18s
-
Conclusion
-
Goodbye16s
-
- Mark as unwatched
- Mark all as unwatched
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.
CancelTake notes with your new membership!
Type in the entry box, then click Enter to save your note.
1:30Press on any video thumbnail to jump immediately to the timecode shown.
Notes are saved with you account but can also be exported as plain text, MS Word, PDF, Google Doc, or Evernote.
Share this video
Embed this video
Video: Calculating payments for a fully amortized loan