Installment Purchase Calculations Spreadsheet Formulas

Max created a spreadsheet for installment purchase calculations.

a. Write a spreadsheet formula to compute the down payment in cell C2.

To calculate the down payment in cell C2, you can use the formula: =A2*B2, where A2 represents the down payment percentage and B2 represents the purchase price.

b. Write a spreadsheet formula to compute the time in months in cell F2.

To determine the time in months for the loan or installment, you can use the formula: =D2*12, where D2 is the loan term in years.

c. Write a spreadsheet formula to compute the total of monthly payments in cell G2.

To find the total of monthly payments, you can use the formula: =E2*F2, where E2 is the monthly payment amount and F2 is the number of payments.

d. Write the spreadsheet formula to compute the finance charge in cell H2.

To calculate the finance charge, you can use the formula: =G2-A2, where G2 is the total cost of the loan and A2 is the down payment.

Final answer:

To perform installment purchase calculations in a spreadsheet, specific formulas are used such as multiplying down payment percentage by purchase price for down payment, converting years to months for the loan term, multiplying monthly payment by number of payments for total of monthly payments, and subtracting loan amount from the total loan cost for the finance charge.

Explanation:

To calculate the down payment in cell C2, we would need additional information such as the percentage of down payment or a fixed amount. However, a typical formula might look something like this if the percentage for down payment is in cell A2 and the purchase price is in cell B2: =A2*B2.

To compute the time in months for a loan or installment, and assuming that the loan term in years is in cell D2, the formula in cell F2 would be: =D2*12 to convert years to months.

The total of monthly payments could be the monthly payment amount multiplied by the total number of payments. If the monthly payment is in cell E2 and the number of payments is in F2, the formula in cell G2 would be: =E2*F2.

Finally, to compute the finance charge in cell H2, which is the total cost of the loan minus the loan amount, if the total cost of the loan is in G2 and the loan amount is in B2, the formula would be: =G2-B2.