Microsoft Excel 2010

The PMT function is useful to calculate loan payments and the total cost of the loan (if you really want to know). The easiest way to enter the PMT formula is by using the Insert Function wizard.

- Select the cell where you wish to place the result.
- Display the Formulas Ribbon and click on
the
**Insert Function**button then choose the PMT function. Refer to the Formula Functions article for more information on creating formulas. **Rate**: Enter your interest rate, e.g. 6% per 12 months.**Nper**: Enter the number of payments, e.g. 12 payments times 5 years.**Pv**: Enter the value of the loan.**Fv**: Optional field. Fv is the future value, or in the case of 'saving up,' the cash balance you want to attain after making the last payment. If fv is omitted, it is assumed to be 0 (zero).**Type**: Optional field. The number 0 (zero) or 1 and indicates when payments are due. 0 (or blank) indicates payments are due at the end of each period. 1 indicates payments are due at the beginning of each period.- When all required fields are entered, notice the formula result at the bottom
of this window. Choose
**OK**to insert the answer into your worksheet.

**Note**: The above window displays the values for calculating payments
for a $15,000 loan at 6% rate with 12 payments/year over a period of 5 years
with payments at the beginning of each month.

- Formulas: About (A MUST-READ!)
- Absolute Cell References – to lock a reference to a cell
- AutoSum – to add up (sum) a series of numbers
- Date Functions – to properly reference calendar dates
- Formula Functions – Average, Minimum, Maximum, Count, and more!
- If Function looks at a cell reference, compares it to specified criteria and performs a specified action
- INT Function - rounds a number down to the nearest integer
- Lookup Function: Vector – to lookup variables from a list and return a variable
- Calculation Options – switch to manual calculation mode to improve data entry response
- Nested If Function – same as IF Function but able to take multiple actions based on multiple conditions
- Round Function –rounds the value of a number to a specified number of digits
- Status Bar - be sure to check this one!