# CUMIPMT Excel Formula

Microsoft Excel is a spreadsheet application that deals with the maintenance, program generation and printing program of various data which is created by Microsoft Corporation. This is usually distributed and sold as part of the Microsoft Office group, which includes Microsoft word and Microsoft PowerPoint. Excel software program is the most common spreadsheet that is widely used by most businesses worldwide. All the spreadsheet applications including Excel allow the users to input data and numbers into a large table cell in any various arrangements whichever the user desires.

Microsoft Excel is widely used to create or make reports, calculations and forms. Alphabetical, mathematical and other Excel functions are mostly available in manipulating all the data. The file format spreadsheet in Microsoft Excel became a global standard due to the increasing popularity of Excel in various businesses throughout the world. With Excel, several companies which are business related to lending can use this application to ease their problem in calculating, formatting, analyzing and creating data.

Banks worldwide are the most common user of this software program wherein repayments on mortgages and loans of equal payments and fixed time-period. Using Excel, only one formula can immediately calculate the repayments of each loan every year. There are two latest functions which are being used in calculating the principal and interest amount of a person’s loan in any given range of time.

The sum of the principal amount and its interest is equals to the result of the “PMT()” function. First, the CUMPRINC function in Microsoft Excel calculates the principal amount being paid within a specific time or period. This function requires the argument series – “CU<MPRINC(InterestRate, NumberOfPeriods, Principal, Start_Period,End_period, PaymentsDue)”. The other function is the CUMIPMT function of Microsoft Excel which returns the cumulative interest being paid within a specific period range. The syntax of this function is “CUMIPMT(InterestRate, NumberOfPeriods, Principal, Start_period, End_period, PaymentsDue)”.

For instance, in February the “number of periods” should be three, which is February, March and April. The end and start period are both one since the interest rate is applied only within that period. With this, the principal is considered as the remaining unpaid amount and not the original amount.

Be reminded that when we refer to the figures of various financial functions of Microsoft Excel, they both contain the final parameter or the so called Payments Due, which is referred to as the payment made from start to ending period. This methodology is considered as the basis for sound accounting to derive the repayment terms and interest charges. However, it might be unmatched to the precise calculation of any various lenders. Thus, there are many complicating variable and factors.

The period or frequency is the main importance in various arrangements in which the interest is being calculated. For more than a year, the entire contrasting values are obtained for a loan. However, repayment periods are obtained daily, for monthly or annually. Keep in mind, that in getting the monthly rate you have to divide the interest rate. Both the number of years and amount is being multiplied by twelve to get the number of payments.

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