![]() ![]() ![]() P: The principal amount or the initial investment.The mathematical expression to determine the compound interest is as follows: And in the second month, it will be ($20,000+$166.66)*(10%/12), which is $168.055, and so on every month for two years, arriving at a total of $24,407.82.Įxample #1 – Using Mathematical Compound Interest Excel Formula Thus, based on the above monthly Compound Interest formula calculation, the interest earned in the first month will be $20,000*(10%/12), which is $166.66. And the formula divides the yearly interest rate by 12 and multiplies the Term by 12, as the interest gets compounded every month in a year.Īnd the result in cell C8 is the overall accumulated sum, which includes the initial investment and the compound interest. The compounding frequency each year is 12. If the data format in the target cell C8 is set as Currency, then, we can apply the monthly Compound Interest formula in Excel cell C8, and achieve the final amount earned. And it also helps determine the inflation in profit and loss.įor example, the table below contains the inputs required for the monthly compound interest calculation. ![]() Users can use the Excel Compound Interest formula to evaluate the compound interest non-annually, and the appreciation and depreciation in commodity prices. The Compound Interest formula in Excel gives the interest amount on savings estimated on the initial principal and accumulated interest from the previous periods. What Is Compound Interest In Excel Formula? ![]()
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