Our company is leasing a truck. They pro-rated the first month. It is a 48 month lease with a residual value of about 10k. We will likely purchase the truck at the end of the lease. I am using excel to create amortization schedules, but I am not sure how to handle the first month being pro-rated. As an example, if the payments are $700.00 for 48 months, and the first payment is $300.00 prorated, how do I set this up in excel? Thanks.
Amortization schedule in excel with first month pro-rated
Answers
There is no way you can set this up in excel because excel can only do basic math and not amortization schedules. My best advice would be to just inpu the value on each cell.
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You can do amortization schedules with excel. However, my question is about a pro-rated first month payment.
The two thoughts I had was:
1. Use IRR on the stream of payments with 48 payments of $700, then calculate the first month prorated amount. Then, use that balance and calculate the remaining stream of 48 payments with the last payment being the last half of the payment.
2. Use IRR with 49 payments, the first being the pro-rated amount, and the last payment being the second half of the first payment.
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