You can use the PMT function to figure out payments for a loan given the loan amount number of periods and interest rate. This tool can be extremely helpful if you need to make some calculations and do not want to waste time in a bank. Taking the PMT function into account the answer would be 888488 which is the monthly installment that takes into consideration both the interest as well as the principal amount.
And taking same philosophy or re-usability this is even simpler with usage of the PMT and IPMT functions.
PMT one of the financial functions calculates the payment for a loan based on constant payments and a constant interest rate. At the same time youll learn how to use the PMT function in a formula. NPER is also known as the number of payment periods for a loan taken it is a financial term and in excel we have an inbuilt financial function to calculate NPER value for any loan this formula takes rate payment made present value and future value as input from a user this formula can be accessed from the formula tab or we can type NPER. The PPMT function above calculates the principal part of the 5th payment.