In the example shown the formula in C10 is. John has to pay 1956 per month. As the monthly payments are paid out they are entered into the function as negative values.
For example if you are applying for a two-year car loan with an annual interest rate of 7 and the loan amount of 30000 a PMT formula can tell you what your monthly payments will be.
The PMT function calculates the payment for a loan that has constant payments and a constant interest rate. The reason behind naming the function as PMT is because it calculates the payment amount. Create one column of all possible interest rates and an empty column for the payment amounts. As the monthly payments are paid out they are entered into the function as negative values.