Excel is a program used in doing financial calculations as well as other types of calculations that the user may require to work out. When one is working with excel program there are some financial functions like PV which present the present value, FV which present the future value and NPER which the total number of payment periods which one needs to apply to arrive at the required answer (Walkenbach, 2010). The answer gotten when calculating any of the above can either be positive or negative, which implies that when the answer is negative the user is supposed to give out, and when the answer is positive, the user is supposed to receive.
The PV is defined as the primary amount of the income, and it is used by an individual or a company to determine the present worthiness of a certain future payments. This function helps the user to determine how much a certain commodity is worth given its future value (Walkenbach, 2010). For this function to help the user there must be a known annual interest rate, duration in terms of years, and the future value of the commodity. For instance, The cash in Present Value = the cash in Future Value / (1 + interest rate)years
The future value helps the user to determine the worthiness of an investment for a given coming years. Most of the companies make use of this function to determine for how much they will dispose off their commodity sometimes in future. The owner of the commodity can use this function to make his or decisions regarding on when it would be necessary to dispose off the commodity (Walkenbach, 2010). For the function to work out the value the user may be required to apply the present value, annual interest rate and the duration of time in terms of years. For instance: FV= PV (1 + interest rate)years
NPER function is used by an individual or a company to determine how regularly the owner will pay the money or how regularly he will be supposed to pay. This function is attained by making use of the term and the period and multiplying both of them.
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