Microsoft KB Archive/48404

Multiplan: Formulas Representing PPMT and IPMT PSS ID Number: Q48404 Article last modified on 08-12-1992 PSS database name: D_MPlan

3.00 3.01 3.02 3.04 4.00 4.01 4.20

MS-DOS

Summary:

The PPMT formula generates the amount of a given payment that is applied toward the principle of a loan. The balance of the payment amount goes toward interest and can be generated by the function IPMT. See Pages A144 and A141 of the “Microsoft Multiplan Addendum” for Version 4.00 for a more detailed description of these functions. See Page 413 of the “Microsoft Multiplan” manual for Versions 3.x for a detailed description of each variable used in the equations shown below. The equation for IPMT is as follows:

IPMT=(pv(1+rate)^(xper-1)+pmt(1+ratet)((1+rate)^(xper-1)/rate))*rate

The equation for PPMT is as follows:

PPMT = pmt - IPMT

More Information:

The variable xper represents the period number for the PPMT function or the IPMT function. Please note that “nper” in PPMT or IPMT is represented as “xper” in the equation above. The xper variable was used in the equation here to avoid confusion with the nper variable used in the PMT function. The nper in the PMT function represents the number of payments over the entire loan. Use the PMT function to generate the pmt variable.

Copyright Microsoft Corporation 1992.