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QuestionMaths behind CUMIPMT function of MS Excel Pin
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AnswerRe: Maths behind CUMIPMT function of MS Excel Pin
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AnswerRe: Maths behind CUMIPMT function of MS Excel Pin
Roger Wright22-Mar-09 18:36
professionalRoger Wright22-Mar-09 18:36 
If you happen to know the amount of the payment (assuming equal payments), there's a shortcut. Multiply the number of payments by the payment amount, then subtract the original balance. This takes a lot fewer calculations than summing all the individual interest amounts, and I suspect that might be important in a handheld device.

If you don't know the payment amount, calculate it from:

Pmt = Amt * (int / ((1 - (1 + int)^(-n)) where

Amt = Initial Principal Balance
Pmt = Payment amount each period
int = Interest rate (in decimal form) for the period
n = number of periods.

The value of int can be calculated by dividing the annual interest rate by the number of payments per year. If you're assuming 10% per year, with monthly payments, int would be .10/12; if payments are made weekly, int = .10/52.

"A Journey of a Thousand Rest Stops Begins with a Single Movement"

GeneralRe: Maths behind CUMIPMT function of MS Excel Pin
73Zeppelin22-Mar-09 21:52
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GeneralRe: Maths behind CUMIPMT function of MS Excel Pin
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