PPMT
Formulas / PPMTCalculate the principal portion of a loan payment.
PPMT(rate, per, nper, pv, [fv], [type])
- rate - the interest rate for a period
- per - a bond's maturity date
- nper - the number of payment periods
- pv - the present value of the loan or investment
- fv - [OPTIONAL] the future value of the loan or investment
- type - [OPTIONAL] determines whether payment is made at start or end of period
Examples
=PPMT(A2/12, 1, A3*12, A4)The function can be used to calculate the principal payment of a loan for a particular month or year. For example, this calculates the principal payment for month 1 of the loan. In this example, A2 is the loan amount, A3 is the interest rate, and A4 is the principal amount.
=PPMT(A8, A9, 10, A10)The function can also be used to calculate the principal payment for a particular year. For example, this calculates the principal payment for year 10 of the loan from loan A8, loan A9, interest rate 10%, and principal amount A10.
=PPMT(1000, 6, 5, 500)The function can also be used to calculate the principal payment of a loan with a specific loan amount, period, interest rate, and principal amount. For example, this calculates the principal payment for period 6 of the loan with a loan amount of 1000, an interest rate of 5%, and a principal amount of 500.
=PPMT(5, 10, 3, 1000)The function can also be used to calculate the principal payment of a loan with a specific duration, interest rate, and principal amount. For example, this calculates the principal payment for 10 periods of the loan with an interest rate of 3%, and a principal amount of 1000.
Summary
The PPMT function is used to calculate principal payments for an investment. It is an important tool for financial planning and management.
- Principal Portion of a Loan Payment: The PPMT function calculates the principal portion of a loan payment, with the first period being the period of interest.
Frequently Asked Questions
What is the PPMT function?
What inputs does the PPMT function take?
What does the PPMT function return?
What are some examples of how the PPMT function can be used?
- Calculating the payments for a loan.
- Calculating the payments for an investment.
- Calculating the payments for an annuity.
