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.
- [Voiceover] When you take out a loan,…you or your accountant might need to know…how much interest you paid for a given period.…For example, if you take a short-term loan…for some construction of $7,320,000…at a rate of 6.125% you might need to know,…specifically, how much interest you pay in a specific month.…In this movie, I will show you how to calculate that amount.…My sample file is the InterestInPeriod_01_04 workbook,…and you can find it in the Chapter 1 folder…of the exercise files collection.…
To do this calculation, we need four pieces of information.…The first is the annual percentage rate.…The second is the period for which…you want to calculate the interest.…Next is the number of periods, in other words,…the number of payments in the loan.…And finally, the amount you borrow,…which is called a present value.…To create the formula, I'll click in cell C9,…then type an = sign, and I'll type in the function,…ispmt, which returns returns the interest paid…during a specific period.…
There are four arguments.…
- Analyzing loans, payments, and interest
- Calculating depreciation
- Determining values and rates of return
- Calculating bond coupon dates and security durations
- Calculating security prices and yields
- Calculating prices and yields of securities with odd periods
Skill Level Intermediate
Accounting Foundations: Fundamentalswith Earl Kay Stice2h 46m Appropriate for all
1. Analyzing Loans, Payments, and Interest
2. Calculating Depreciation
3. Determining Values and Rates of Return
4. Calculating Bond Coupon Dates and Security Durations
5. Calculating Security Prices and Yields
6. Calculating Prices and Yields of Securities with Odd Periods
Additional resources1m 24s
- 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.Cancel
Take 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.