ex1ch6

ex1ch6 - 6 $2.03 $405.00 $0.00 P = 2400 A = 2400(A/P, 0.5%,...

Info iconThis preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon
Spreadsheet Example, Chapter 6, Page 222 New furniture, 6 month financing at 6 percent per annum 2400 Initial balance 0.50% I 6 N $407.03 Payment Principal Ending Month Interest Payment Balance 0 $2,400.00 1 $12.00 $395.03 $2,004.97 2 $10.02 $397.00 $1,607.97 3 $8.04 $398.99 $1,208.98 4 $6.04 $400.98 $807.99 5 $4.04 $402.99 $405.00 6 $2.03 $405.00 $0.00 Totals: $42.17 $2,400.00 1. Take ending balance from preceding period (D8). 2. Multiply by interest rate (A2) to determine the amount of interest that will be charged on D8 during the month. 3. Subtract the amount of interest (B9) from the monthly payment to determine how much of the payment goes to principal 4. Continue until the loan is completely amortized. Principal Ending Month Interest Payment Balance 0 2400 1 $12.00 $395.03 $2,004.97 2 $10.02 $397.00 $1,607.97 3 $8.04 $398.99 $1,208.98
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4 $6.04 $400.98 $807.99 5 $4.04 $402.99 $405.00
Background image of page 2
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 4
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 6
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 6 $2.03 $405.00 $0.00 P = 2400 A = 2400(A/P, 0.5%, 6) = 2400(0.1696) = $407.03 The Formulae Used at Left Principal Month Interest Payment 1 =$A$4*D10 =$A$6-B11 2 =$A$4*D11 =$A$6-B12 3 =$A$4*D12 =$A$6-B13 4 =$A$4*D13 =$A$6-B14 5 =$A$4*D14 =$A$6-B15 6 =$A$4*D15 =$A$6-B16 l (C9). =IPMT(I, t, N, -P) =PPMT(I, t, N, -P) Principal Month Interest Payment 1 =IPMT(0.5%,1,6,-2400) =PPMT(0.5%,1,6,-2400) 2 =IPMT(0.5%,2,6,-2400) =PPMT(0.5%,2,6,-2400) 3 =IPMT(0.5%,3,6,-2400) =PPMT(0.5%,3,6,-2400) 4 =IPMT(0.5%,4,6,-2400) =PPMT(0.5%,4,6,-2400) 5 =IPMT(0.5%,5,6,-2400) =PPMT(0.5%,5,6,-2400) 6 =IPMT(0.5%,6,6,-2400) =PPMT(0.5%,6,6,-2400) Ending Balance =A3 =D10-C11 =D11-C12 =D12-C13 =D13-C14 =D14-C15 =D15-C16 Ending Balance =A3 =D32-C33 =D33-C34 =D34-C35 =D35-C36 =D36-C37 =D37-C38...
View Full Document

Page1 / 6

ex1ch6 - 6 $2.03 $405.00 $0.00 P = 2400 A = 2400(A/P, 0.5%,...

This preview shows document pages 1 - 6. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online