Apple iWork '09 User Manual

Page 113

Chapter 6

Financial Functions

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end (0): Payments are due at the end of each period.
beginning (1): Payments are due at the beginning of each period.

Examples

It is generally understood that the amount of the principal reduction on a loan is higher in the later
years, as compared to the early years. This example demonstrates just how much higher the later
years can be. Assume a mortgage loan with an initial loan amount of $550,000, an interest rate of 6%,
and a 30-year term.
The CUMPRINC function can be used to determine the interest for any period. In the following table,
CUMPRINC has been used to determine the principal repaid in the first year (payments 1 through 12)
and in the last year (payments 349 through 360) of the loan term. The function evaluates to $6,754.06
and $38,313.75, respectively. The amount of principal paid in the first year is only about 18% of the
amount of principal paid in the last year.

periodic-rate

num-periods

present-value

starting-per

ending-per

when-due

=CUMPRINC
(B2, C2, D2, E2,
F2, G2)

=0.06/12

360

=550000

=CUMPRINC
(B2, C2, D2, E3,
F3, G2)

349