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Creating Formulas for Financial Applications 16<br />

FIGURE 16.14<br />

This worksheet contains formulas to calculate annuities.<br />

TABLE 16.4<br />

The Annuity Calculator Worksheet<br />

Cell Formula Description<br />

B4 None (input cell) Initial investment (can be 0)<br />

B5 None (input cell) The amount deposited on a regular basis<br />

B6 None (input cell) The number of deposits made in 12 months<br />

B7 None (input cell) TRUE if you make deposits at the beginning of period;<br />

FALSE otherwise<br />

B10 None (input cell) The length of the investment, in years (can be fractional)<br />

B13 None (input cell) The annual interest rate<br />

B16 =B4 Displays the initial investment amount<br />

B17 =B5*B6*B10 Calculates the total of all regular deposits<br />

B18 =B16+B17 Adds the initial investment to the sum of the deposits<br />

B19 =B13*(1/B6) Calculates the periodic interest rate<br />

B20 =FV(B19,B6*B10,-B5,-B4,IF(B7,1,0)) Calculates the future value of the investment<br />

B21 =B20-B18 Calculates the interest earned from the investment<br />

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