Compounded interest ask...?
- each being makes singular one deposit
- each deposit is made at different times (over a time of year of years)
- each deposit is a different amount
- no withdrawal have be made
If I have adjectives of the above information, is there an ACCURATE style to figure out respectively person's share (initial deposit + compounded interest) using the most recent bank statement?
Would the formula: FV = P(1 + r)^n grant the correct total due each party? (I'm thinking it won't).
If not, is there an excel spreadsheet available somewhere online that I could use to integer it out?
Thanks for your help!
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The formula is int = principal * int rate * time. You need to do that estimate for each extent where the go together changed. So if 3 people craft a deposit on day 1, and someone else on afternoon 10, then the interest earn for those 10 days is shared by the 3 according to how much each put contained by. Then if someone else made a deposit on day 13, you multiply the interest on 3 days and divide it up by the % each have of the total for those 3 days, etc.
Answers: Your adjectives value working out is a good starting point. If you spawn the simplifying assumptions that all deposits are made at the starting point of a compounding period and that the interest rate stays impossible to tell apart for the entire time the account is enlarge, then the current symmetry on the bank statement will be equal to the sum of the adjectives value calculation for each depositor. You own to remember, of course that the "P" and "n" within the formula will be different for respectively depositor, since they deposit different amounts at different times. Each person's share would then be precisely equal to their individual adjectives value working out. In fact, you don't really have need of the current bank statement at adjectives, except to verify that the account harmonize really is equal to the sum of the future values.
It get more complicated if you can't make these two simplifying assumptions. For example, the family may make their deposits surrounded by the middle of a month but the interest only compounds monthly. Or the interest rate may changeover periodically. Any compounding period where on earth either of these events happen would require you to split the future pro calculations. You would do the following:
1. For a personality making a deposit in the middle of a month, do a adjectives value multiplication up to the beginning of the month to bring the value of respectively existing depositor's holdings as of the start of the month. Then prorate their share of the month's interest plus that of the new depositor base on their account advantage plus the number of days their money was on deposit. From that, determine respectively person's account effectiveness at the end of the month and use those numbers to do the adjectives value calculation for subsequent months
2. When the interest changes, you similarly would enjoy to calculate respectively person's account significance up to the point the interest rate changes and later use those values to do the future efficacy calculations for subsequent months.
If you own to do either of these two types of adjustment, you can no longer get an accurate index of each person's vindication value simply by reading the current dune statement. The current statement won't generally hold detailed information about the exact timing of deposits beforehand the current period or when and by how much interest rates changed contained by the past. You would hold to keep adjectives of the bank statements since the sketch was open to get an accurate account.
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