Enlarge on Calculations of Present Value Formulas in Excel for Continuous Compounding & Perpetuity

We will talk about the rest of PV in this article to complete all previously mentioned. As usual, we use Microsoft Excel to mathematically calculate the formulas or to insert Function to return the solution. Moreover, we will enlarge on the certain formulas by proving the different forms around the bottom of the page or in the link file. Logarithm is also used to calculate the number of the years in the financial formula.

As below, I provide you the picture with the description and the link file to each item. Also note that the two new functions have been used in the link files: EXP and Seriessum.

1 PV of a Future Sum with Continuous Compounding:

Financial Formulas and Functions on Microsoft Excel for Present Value

Previously we talked about the future value which is one of the two main types of time value of money. Accordingly, we should continue time value of money to know more about the second type i.e. Present Value called PV for this article.
The point of this article is showing us the calculations of the various financial formulas of PV with Microsoft Excel. Each financial formula and its own pattern and details come along with the calculation of the given values of all elements from the formula in addition to the PV function on Microsoft Excel. As the result, we can choose the right one to match our criteria and know how to exercise it to meet our requirements. To ensure the results of the following pictures and files relevant to the financial formulas mentioned above, the online calculator as below can work with the pictures or files.

1) PV of a Future Sum: Given FV= 300.73 the only one future sum, r= 6% interest, n= 7 the number of years.

Fill in function arguments of PV as follows: Rate= 6%, Nper= 7, FV= -300.73, Type= 0 (end= ordinary) or leave it blank

2) PV of a Future Sum with Compounding: the same as above with the additional compounding per year= 12.

Fill in function arguments of PV as follows: Rate= 6%, Nper= 7*12, FV= -300.73, Type= 0 (end= ordinary) or leave it blank