R rate of return 10 compounded annually. Where P is the initial invested amount or principal amount r is the rate of interest n is the time period for which interest gets compounded. 50000110100 5 50000 8052550 50000.
Heres the compound interest formula.
The Excel compound interest formula in cell B4 of the above spreadsheet on the right once again calculates the future value of 100 invested for 5 years with an annual interest rate of 4. It is to be noted that the above formula is the general formula for the number of times the principal is compounded in a year. Compound interest formula Compound Interest A P 1 RnnT A the future value of the investmentloan including interest P the principal investment amount the initial deposit or loan amount. The additional earnings plus simple interest would equal the total amount earned from compound interest.