Michael Germaine is the general manager of Adela Mountain Resort, a year-round sports resort in Ketchum, Idaho.

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Question:

Michael Germaine is the general manager of Adela Mountain Resort, a year-round sports resort in Ketchum, Idaho. He needs to work with financial data for the resort, including the loan for a new inn. He also wants to consolidate rental data from three locations that provide lodging and analyze rental data for the resort’s cabins. Michael wants to start by calculating how the loan for the inn will affect the company’s budget each month and over the life of the loan. He also wants to consider how mortgage interest rates will affect the total cost of the new inn. Switch to the Inn Mortgage worksheet, and then determine the monthly loan payments for the new inn as follows:

a. In cell D5, use the PMT function to calculate the monthly payment for the inn mortgage using the defined names Rate, Term_Years, and Loan_Amount as the rate, nper, and pv arguments in the formula.

b. In the formula, divide Rate by 12.

c. Multiply Term_Years by 12 to calculate the total number of monthly payments.

d. Insert a negative sign before the PMT function to make the formula return a positive value.