ITEC1010 – Section M – Winter 2000

Practice Spreadsheet Problem

Loan Payments

Design and implement an Excel spreadsheet to calculate the payments for a loan. The parameters include the interest rate, the amount of the loan, and the amortization period. Set the interest rate to 12%, the amount of the loan to $1200, and the amortization period to 20 months. Assume there is one payment per month.

Your worksheet should illustrate the month-by-month status of the loan, from the date the loan is obtained to the date it is paid off. As well as the monthly payment, show the amount of interest and principle in each payment and the balance due. Hint: Use Excel’s PMT function to compute the monthly payment.

PMT formula synopsis: