Hi

What is the formula used to compute Accured Cashflow (cash balance) minus pending loans?

I want to try and model my proposal on monthly basis.

 

thanks

Hi Tom,

thank you for your question. The Accrued Cashflow minus the pending loans would be your normal cashflow minus all the loan repayments and interests that you still have to pay in future.

So, for example:

Here I defined a 10 year loan over some 4320 $ with 2 % interest rate and the first 2 years without repayment. If you sum up all loan repayments and interests until year 10, you'll get -5254.16 $. To calculate the Accrued Cashflow minus pending loans for the first year, you'll take the normal cashflow (701.79 $) and subtract the 5254.16 $, but, as you consider the end of the first year, you'll omit the first interest payment of 85.54 $.

That is:

- 701.79 $ Annual Cash Flow
- 5254.16 $ Total loan payments (repayment and interest)
+ 85.64 $ First loan interest already paid
--------------------------------------
- 5168.62 $  Accrued Cahsflow minus pending loans after the first year

 

Hope that helped, kind regards,

Martin

 

And I changed the title of your post. Hope that is ok with you

Thanks for the clarification.  However, when i worked it out on excel, i got a total interest and loan repayment of $4552.37. I added the accured cashflow of 701.79  and reduced the 1st interest payment  and got the accrued cashflow minus pending loans after the 1st year.  I think we get the same answer but different way to get there.  

Is your 1st loan interest number changes from 85.54 to 85.64?  Is this a error?  appreciate confirmation.

Is your loan period for 11 years or 10 years?

thanks

 

 

 

 

 

One final question:

err, yes, you're right, sorry. The numbers above don't make sene. The sum of all loan repayments and interests is of course -4552.37 $, excluding the payment of the first year it is -4466.83 $. Then you subtract the normal annual cashflow of 701.79 and you have the -5168.62 $.

sorry for the confusion (the explanation was right though )

And yes, I had a typo in the first loan interest rate, it should have been 85.54 $. The loan period is 10 years.

Cheers, Martin

Thanks, Martin for the clarification.  I appreciate your prompt reply.  :-)

Yes. your explanation was spot on!