Excel's Formula - sisman

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Part III: Financial Formulas
Creating Amortization Schedules
In its simplest form, an amortization schedule tracks the payments (including interest and principal
components) and the loan balance for a particular loan. This section presents several examples
of amortization schedules.
A simple amortization schedule
This example uses a simple loan to demonstrate the basic concepts involved in creating a
dynamic schedule. Refer to the worksheet in Figure 13-1. Notice that rows 19 through 369 are hidden,
so only the first five payments and last five payments are visible.
Figure 13-1: A simple amortization schedule.
All the examples in this section are available on the companion CD-ROM in the workbook
amortization.xlsx.
User input section
The area above the schedule contains cells for user input and for intermediate calculations. The
user input cells are shaded, so it’s easy to determine what can be changed and what has a formula.
The user can enter the purchase price and the down payment. The amount financed is calculated
for use in the amortization calculation. The formula in cell B5 is
=Purchase_Price–Down_Payment