36
Calculating pa
yments,
interest,
and loan bal-
ance after a specifi
ed
pa
yment
Y
ou ha
ve
tak
en out a 30-y
ear loan f
or $500,000, with an ann
ual
interest r
ate of 8.5%.
If
, after the 48th per
iod, y
ou w
ant a balloon
pa
yment due
, what amount of monthly pa
yment m
ust y
ou mak
e
with monthly compounding and ho
w m
uch will the balloon pa
y-
ment be?
Pr
ocedure
K
e
y
operation
Displa
y
Set all the v
a
riab
les to
def
ault v
alues
.
s
.
b
000
Mak
e sure ordinar
y ann
uity is set (
BGN
is not displa
y
ed).
Set
TVM solv
er v
a
ri-
ab
les and calculate
pa
yment.
.
w
12
Q
s
30
.
<
N
500000
v
0
T
8.5
f
@
u
PMT=
-384457
Ans
wer:
The monthly pa
yment is $3,844.57.
No
w gener
ate an amor
tization schedule from the fi
rst to the
48th pa
yments
.
Pr
ocedure
K
e
y
operation
Displa
y
Change to amor
tization
calculation and enter 1
for the star
ting pa
yment.
*
1
Q
AMRT
P1=
100
Enter 48 (December)
for the ending pa
yment.
i
48
Q
AMRT
P2=
4800
Displa
y the balance af-
ter 48 months
. (balloon
pa
yment)
i
BALANCE=
48275524
Displa
y the pr
incipal
paid o
v
er 48 months
.
i
ÍPRINCIPAL=
-1724476
Displa
y the interest
paid o
v
er 48 months
.
i
Í
INTE
R
EST=
-1
672
94
60
Ans
wer:
The balloon pa
yment after the 48th per
iod w
ould be
$482,755.24.
2
3 Financial FunctionsCurrent.indd 36
06.7.10 8:38:31 PM