Same input, different answers

[Tomlilly]

I was using the formula to get a principal balance after 8 years of payment. I entered $250,000 PV, 5.25 g(i) and then 96 (n) and FV,  which should give me a $215,879.38 principal balance after 8 years of payments. It worked great for several inputs, but now I’m getting a 380,141 number. Then when I run $250,000 PV, 5.25 g(i) and 30 g(n) and PMT it gives me the correct $`380.510 and the original formula gives me $215,879.38 correct principal balance. It shows as a negative number... but I don’t care about that. I just don’t know what’s staying in the formula that it keeps alternate answers between the two numbers.

Brand new and trying to work through the manual. I’m clearing everything with the f key... but still get answers that very between the correct $215,000 number and $380,000 number with same inputs.

[David_M · Accepted solution]

First, I don't have a 12c Platinum to try this on, but I do have a regular 12c.  I believe that shouldn't make a difference for this question, though.

Taken literally, the first part of your description does not include any provision for determining a payment, which means that PMT will be set to whatever it was when you started the problem.  If you cleared everything before starting, that would be 0.  In that situation, the correct FV for these inputs:

n: 96

i: 5.25 (÷12)

PV: 250000

is -380141.9892.

Data is stored into the TVM variables either explicitly by entering a number and then pressing the appropriate key (n/i/PV/PMT/FV), or implicitly by solving for the unknown.  The value will stay in the TVM variables until they are either cleared as a group, solved individually, or re-entered manually.

Your question then describes solving for PMT, but with a different set of variables.  The order of steps here is very important.  If you solve for the PMT after solving for the FV, then the PMT will be based on a different set of factors than you intended (in this case, the FV won't be 0 as it should be).

Based on your description, I'm guessing that you originally intended to solve for the PMT before the FV, not the other way around.  That's the only way you could have come up with a FV of -215879.38.

That would imply that the following steps would give you the answers I believe you're expecting:

Start with cleared TVM variables

f FIN

(also make sure that you are in END mode, not BEGIN)

Part 1 (solve for PMT)

30 g n      (30 x 12 = 360)

5.25 g i      (5.25 ÷ 12 = 0.4375)

250000 PV

Solve for PMT: -1380.509255

Part 2 (solve for FV)

96 n

Solve for FV: -215879.3875

Note that after the above calculations are performed, the TVM variables now contain the following values:

n: 96

i: 0.4375

PV: 250000

PMT: -1380.509255

FV: -215879.3875

Any subsequent TVM calculations will be performed with the above values in place unless you change or clear them.

[Tomlilly]

Of course... payment first... which is why it worked sometimes.So when I cleared the formulas I would lose the payment call. Second real day learning the system.... very appreciative.

[David_M]

Glad to help.  Give it some time, and I think you'll see that the design of the system works quite well for chaining calculations together and trying out "what if" scenarios.

If at any time you can't remember what's currently in the TVM registers, you can also press RCL then the TVM variable key that you need.  This will recall the current contents of that variable to the stack.

Good luck with your new calculator!

[Tomlilly]

Is there a simple way to know which calcs should use Begin or End? 

[David_M]

BEGIN and END modes apply to any TVM calculations that involve recurring payments (basically any time you either enter or solve for PMT).

Generally speaking, mortgages are usually END mode since the payment is paying the accumulated interest for the period.  Annuities are usually BEGIN mode, since the deposits are considered to be at the beginning of each period.  There can be exceptions to those rules, but just keep in mind that BEGIN/END applies to the PMT amount and you'll be OK.