Description
ISPMT returns the interest paid during a specified period.
Arguments
rate is a number specifying the interest rate per period.
period is a number specifying the period of interest.
nPeriods is a positive Number that specifies the total number of payment periods in the annuity. The units used for specifying rate and nPeriods must consistent. For example, if nPeriods is the number of periods in months, then rate is a monthly interest rate.
presentValue is the value of the investment or loan.
Action
ISPMT returns the interest paid during a specified period. This function assumes that equal installments are paid off against the principal each period.
Examples
Suppose $1000 is borrowed for ten years at an interest rate of 4%, and the $1000 is to be paid back in equal installments per year.
ISPMT(0.04,0,10,1000)
Returns -$40. This is the interest due for the first year (zeroth period). For the first year the full $1000 is outstanding at 4% interest, so $1000 x 0.04 = $40. The value is negative since it represents a payment of $40.
ISPMT(0.04,3,10,1000)
Returns -$28. This is the interest due for the fourth year (third period). By this time, three installments of $100 have been paid so the interest due is ($1000 - 3 x $100) x 0.04 = $28.
Comments
This function is designed to work like the Excel function of the same name.