Calculating Quarterly Payment for a Loan in Excel
To calculate the quarterly payment required for a loan, follow these steps:
- Enter the loan amount in cell A1.
- Enter the annual interest rate in cell A2.
- Enter the loan term in years in cell A3.
- Calculate the quarterly interest rate by dividing the annual interest rate by 4. Enter the formula "=A2/4" in cell A4.
- Calculate the total number of quarterly payments over the life of the loan. Enter the value "24" in cell A5.
- Use the PMT function to calculate the quarterly payment required for the loan. Enter the formula "=PMT(A4,A5,A1)" in cell A6.
The quarterly payment required for a $20,000 loan at an annual interest rate of 10% for 6 years is
.