Excel Tutorial Part 3

Directions: You will need to calculate how much you will end up paying on a loan with the interest included.  Follow the steps below to learn how. 

Steps 1- Insert a picture into your excel document that relates to repaying a loan and go to Insert, Picture, Word Art, select a word type for your title and write “Uncle Guido’s Gambling Loan.”  See below.

 

Step 2- Enter in Loan Amount in cell E7.  Note: You may have to change the size of your picture or the size of your word art so you can type in E7.  Enter in Interest Rate in cell E8, Enter Terms(in months) in cell E9, and Enter Loan Payment in cell E11.  See below.

 

Step 3- In cell H12 click Paste Function button to open the Paste function dialog.  Functions are grouped by category, with the categories appearing on the left and the functions appearing on the right.  The PMT function is a financial function, so click Financial in the left pane and select PMT in the right pane.  a description of the PMT function will appear.  Click OK.  See Below.

Step 4- The PMT dialog box appears ready for you to fill in the blanks.  To enter the interest rate, click in the Rate text field and then type H8 /12.  This states that you will make one payment for each of the 12 months of the year.  See Below.

Step 5- Next to Nper (number of periods) type in H9 and next to Pv(amount you owe) type -H7.  See Below.

 

Step 6- Hit OK when you are finished and type the following:

H7 100
H8 5
H9 12

Step 7- Call me over when you are finished and explain what the dollar amount you get means in H12.

 

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