In the investment process, the most important thing is the interest - based on the determination of the interest payable to have the most appropriate adjustment direction. The following article introduces in detail ISPMT function - The function of calculating interest in a definite term helps you have the best direction.
Description: The function calculates the interest of an investment for a specific period.
Syntax: ISPMT (rate, per, nper, pv) .
Inside:
- rate: The interest rate of the investment, which is a required parameter.
- per: The period you want to calculate interest, the value determined from 1 -> nper, is a required parameter.
- nper: Total number of terms in the investment process, which is required.
- pv: Present value of the investment, where the investment is the borrowed value, pv is the amount borrowed to invest, pv is the required parameter.
Attention:
- Between nper and pv, it is necessary to be consistent about units, for example, if nper is calculated by month, then pv is required to be monthly.
- With the payables shown as negative numbers, and amounts such as dividend checks, deposits are represented by positive numbers.
For example:
Calculate the amount of interest payable in the first and second month of an investment knowing the following parameters:
- Calculating interest payable in the first month is:
In the cell to be calculated enter the following formula: = ISPMT (C14 / 12, C15, C16 * 12, C17) .
Because interest is calculated in the 1st month, the interest rate is divided annually c14 / 12 and the total investment period is calculated monthly C16 * 12.
Pressing Enter results (because the interest value should be negative):
So with an investment of 600 million loans at the interest rate of 0.326 the first month to pay more than 16 million interest.
- Calculating interest payable in the 2nd year.
In the cell to calculate enter the formula: = ISPMT (C14,2, C16, C17) .
Pressing Enter results (because the interest value should be negative):
So if in the 2nd year, the investment is not paid, it must pay interest of over 130 million.
The above is a detailed guide on how to use the ISPMT function. Hope to help you in determining the amount of interest to pay from there in the right direction.
Good luck!