This is the principal portion of the payment for period 1 of the loan.
Notice we have provided the loan balance as a negative value to get a positive result from PPMT.
If we provide 10,000 as a positive number, PPMT will return -147.05.
In practice, the decision to use a positive or negative value forpvdepends on the specific scenario.
More typically, the inputs will come from cell references.
Also, notice that the PPMT function does not need the monthly payment.
To calculate the payment for a loan you’re able to use thePMT function.
The RATE function calculates by iteration.
