How to use the CUMPRINC function
What is the CUMPRINC function?
The CUMPRINC function calculates the accumulated principal based on a start and end period on a loan.
What is accumulated principal?
The original principal is the amount originally borrowed. As payments are made part of each payment goes towards reducing the principal and the remaining part pays the interest.
On a loan, accumulated principal increases over time as payments are made until the loan is repaid.
CUMPRINC function Syntax
CUMPRINC(rate, nper, pv, start_period, end_period, type)
CUMPRINC function Arguments
| rate | Required. The interest rate. |
| nper | Required. The total number of periods in an annuity.
Examples: |
| pv | Required. Present value. |
| start_period | Required. The first period. |
| end_period | Required. The last period. |
| type | Required. When payments are due.
0 - End of period. |
What is an annuity?
An annuity is a series of equal payments made over a defined period of time. The payments are usually made monthly, quarterly, or annually. These payment intervals are the "periods" that nper counts.
For example, if an annuity pays out quarterly for 3 years, there would be:
4 payments per year
3 years
So nper = 4 * 3 = 12 total payment periods
What is interest rate?
A fixed interest rate is an interest rate that remains the same throughout the term of a loan or an investment.
What is a monthly payment?
A monthly payment is a scheduled payment that occurs every month as part of an ongoing loan, mortgage, or other finance agreement.
What is a quarterly payment?
A quarterly payment is a scheduled payment that occurs every quarter as part of an ongoing loan, mortgage, or other finance agreement.
CUMPRINC function example
The image above shows the CUMPRINC function in cell E3 calculating the accumulated principal for month 25 to 36 for a 10 year loan of 100 000.
Formula in cell E3:
Comments
The CUMPRINC function returns
- #NUM error value if:
- rate <=0
- nper <=0
- pv<=0
- start_period < 1
- end_period < 1
- start_period > end_period
- type is not 0 (zero) or 1
Use the same unit for rate and nper, the above example uses monthly payments. That is why the interest rate is divided by 12 and nper is multiplied by 12. There are 120 monthly payments in a 10 year period.
This image shows the principal for month 25 to 36 and the cumulative principal. The amount in cell G22 is the same as in the top image cell E3.
Functions in 'Financial' category
The CUMPRINC function function is one of many functions in the 'Financial' category.
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