Template Amortization

The Amortization displays period-by-period information. Included information is ending balance, payment, interest and principal amounts.

Period View

To calculate the values over the range of periods, enter a period for Beg Period and another one for End Period. The displayed information is the accumulated amount over the selected range. Data includes:

• End Balance: ending balance.
• Payment: total payments paid or received.
• Interest: total interest paid or received.
• Principal: total principal paid or received.

Additionally, menu items are available. These menus are used to quickly enter beginning and ending period values and perform computations:

• Maximum: sets the ending period to the maximum number of periods.
• Next: moves to the next set of beginning and ending periods. For example, with both set to one, selecting next moves the beginning and ending period to two.
• 1 Year: calculates one year from the beginning period.
• Duplicate: duplicates the beginning period in the ending period.

Payment Timing Issues

Whether payments are made at the beginning or end of the period impacts how amortization information is calculated. This impacts the values shown in the amortization table in a way best illustrated by time line diagrams.

When payments are made at the end of the period (common for loans and mortgages), interest is accrued just before the payment is due. Note that the Ending Balance will always be the same as the Beginning Balance for the following payment period.

When payments are made at the beginning of the period (common for leases), interest is accrued after the end of the period. Note that the Ending Balance of a period will be less than the Beginning Balance of the next period by the amount of interest that accrued during that period.