Sharp El738 User Guide

20
The ENT and COMP symbols
Listed fi nancial variables are categorized by whether they are 
known or unknown. When the variable is selected (displayed), 
the “ENT” and/or “COMP” symbols will appear to indicate that 
the current variable may be entered (known variable) and/or 
calculated (unknown variable), respectively. For details, refer to 
the explanations or examples for each fi nancial function.
Note:  TVM variables (N, I/Y, PV, PMT and FV) can be entered 
(known variables) and calculated (unknown...

21
Compound interest
This calculator assumes interest is compounded periodically in 
fi nancial calculations (compound interest). Compound inter-
est accumulates at a predefi ned rate on a periodic basis. For 
example, money deposited in a passbook saving account at 
a bank accumulates a certain amount of interest each month, 
increasing the account balance. The amount of interest received 
each month depends on the balance of the account during that 
month, including interest added in previous months....

22
TVM (Time Value of Money) Solver
Analyze equal and regular cash fl ows. These include calcula-
tions for mortgages, loans, leases, savings, annuities, and 
contracts or investments with regular payments.
Note: Discounted cash fl ow analysis can be done using un-
equal cash fl ows (see page 37).
An amortization schedule can be calculated using the 
information stored in the TVM solver (see page 33).
Variables used in the TVM solver
VariableCorresponding
variable keyDescriptionDefault
value
N
NTotal number...

23
3. Enter values into TVM solver variables.
•  Enter a value and press the appropriate TVM variable key 
(
N, 
f, 
v, 
u, 
T).
• Press 
. 
w and then enter a value for P/Y. The 
same value is automatically assigned to C/Y as well. Val-
ues entered into P/Y or C/Y must be positive. After enter-
ing values, press 
s to quit the P/Y and C/Y settings.
•  After setting P/Y (number of payments per year), you can 
use 
. 
< to enter N (total number of payments). 
Enter the number of years and press 
. 

24
Procedure Key operation Display
Set all the variables to 
default values.. 
b
000
Make sure ordinary annuity is set (BGN is not displayed).
Set the number of pay-
ments per year to 12.. 
w 
12 
QP/Y=
1200
The number of compounding periods per year is automatically set to the 
same value as P/Y.
Confi rm the number of 
compounding periods 
per year.i
C/Y=
1200
Quit the P/Y and C/Y 
settings.s
000
Calculate the total num-
ber of payments and 
store in N.20 
. 
< 
NANS~N
24000
Enter the present...

25
       Calculating basic loan payments
Calculate the quarterly payment for a $56,000 mortgage loan 
at 6.5% compounded quarterly during its 20-year amortization 
period.
I/Y = 6.5%
N = 4 × 20 years = 80...... PV = $56,000
FV = 0
PMT = ?
Procedure Key operation Display
Set all the variables to 
default values.. 
b
000
Make sure ordinary annuity is set (BGN is not displayed).
Set the number of pay-
ments per year to 4.. 
w 
4 
QP/Y=
400
Confi rm the number of 
compounding periods per 
year.iC/Y=
400
Quit...

26
       Calculating future value
You will pay $200 at the end of each month for the next three 
years into a savings plan that earns 6.5% compounded quar-
terly. What amount will you have at the end of period if you 
continue with the plan?
N = 12 × 3 years = 36...... PV = 0
PMT = –$200 I/Y = 6.5% (quarterly)FV = ?
PMT = –$200
Procedure Key operation Display
Set all the variables to 
default values.. 
b
000
Make sure ordinary annuity is set (BGN is not displayed).
Set the number of pay-
ments per year...

27
                      Calculating present value
You open an account that earns 5% compounded annually. If 
you wish to have $10,000 twenty years from now, what amount 
of money should you deposit now?
FV = $10,000
N = 20 years
PV = ? I/Y = 5%
Procedure Key operation Display
Set all the variables to 
default values. .
 
b
000
Make sure ordinary annuity is set ( BGN is not displayed).
Set the number of pay-
ments per year to 1. .
 
w  
1 
QP/Y=
100
The number of compounding periods per year is...

28
Specifying payments due (. 
")
This calculator can select ordinary annuity or annuity due de-
pending on the regular cash fl ow (payment) conditions.
Ordinary annuity (END):
This is the default setting for fi nancial calculations.  BGN is not 
displayed. A regular cash fl ow (payment) is received at end of 
each payment period. Often applied to loan calculations, etc.
Annuity due (BGN): 
BGN  appears on the display. A regular cash fl ow (payment) is 
received at the beginning of each payment period....

29
Procedure Key operation Display
Enter the total number 
of payments.s 18
 
N
18~N
1800
Enter the future value.300000
 
T3—————~FV
30000000
Set the present value to 
zero.0
 
v—~PV
000
Enter the annual inter-
est rate.3.6
 
f3.6~I/Y
360
Calculate payment.
@ 
uPMT=
-1624570
Answer: The monthly investment should be $16,245.70.
 Annuity due
Your company wishes to obtain a computer system with a value of 
$2,995. The same system may be leased for 24 months at $145 per 
month, paid at the beginning of each...