Visual basic provides some very handy financial functions which makes accounting and financial calculations effortless. Some of the financial functions are listed below.
Function
Meaning
Pmt
compute the payment for an annuity Ipmt
computes the interest payment for a certain period PPmt
computes the principal payment IRR
computes internal rate of return for cash flows Rate
computes interest rate per period FV
Calculate the future value PV Computes the present value NPV computes net present value Nper Computes the value of Tangent of an angle in radian Below is an example of using Pmt function to calculate the monthly payment for a loan. The format of Pmt is
Pmt(Rate, NPer, PV, FV,Due)
Rate=Interest rate, Nper=Number of payment periods, PV=present value, FV=future value, Due=set to 1 if payment due at the beginning of period and 0 for payment due at end of period.
The codes
Private Sub cmd_Compute_Click()
Dim N As Integer
Dim amt, payment, rate As Double
amt = Val(Txt_loan.Text)
rate = (Val(Txt_Int.Text) / 100) / 12
N = Val(Txt_N.Text) * 12
payment = Pmt(rate, N, -amt, 0, 0)
Lbl_payment.Caption = Format(payment, "$#,##0.00")
End SubExplanation:
Normally people will just key in the annual interest rate as integer rather than as %, so I have to divide that rate by 100 and then by 12 to get the monthly interest. Why use negative sign for the present value(PV)? Because that is the amount we borrowed, so it must be negative. The future value is set to 0 because by then you have pay up all the payment. Finally, due is set to 0 as the payment is due at end of the month.
