OUTStanduing

Balance
Mth 215 (835)
 DEFINITIONS OF TERMS
Outstanding Balance.
Typically refers to the amount of money
that remains unpaid on a financial
obligation, such as a loan, credit card,
or invoice. It represents the total
amount owed at a given point in time
after considering payments made and
any additional charges or interest that
may have accrued..
To solve for the outstanding
balance, you'll need to take into
account the original amount, any
payments made, and any additional
charges or interest that have been
applied. The formula for calculating
the outstanding balance depends on
the type of financial obligation.
Outstanding Balance
Imagine you borrowed some money or
bought something on credit. The
outstanding balance is the amount you
haven't paid back yet. It's the running
total of what you still owe.
Outstanding Balance for Loans:
The formula for the outstanding balance on a loan is:
Outstanding Loan Balance=Original Loan Amount−Total Payments
Made+Accrued Interest or ChargesOutstanding Loan Balance=Origi
nal Loan Amount−Total Payments Made+Accrued Interest or Charge
s
For example, if you have a loan of $10,000, made payments of
$2,000, and accrued $500 in interest, the outstanding balance would
be 10,000-2000+500
=7500
FORMULAS
 EXAMPLE #1
Amy has a car loan of $15,000. She has made payments of $4,000 so far, and there is an
additional interest charge of $500. Calculate the outstanding balance on Amy's car loan.

Outstanding Loan Balance=Original Loan Amount−Total Payments Made

+Accrued Interest or Charges
Outstanding Balance= $15,000 - $4,000 + $500 = $11,500
 EXAMPLE #2
John has a credit card with an original balance of $2,500. He made a payment of $800, but there were additional charges and
interest of $150. Calculate the outstanding balance on John's credit card.

Outstanding Credit Card Balance=Original Credit Card Balance−Total Payments Made+New Charges or
Interest

2500-800+150
1850
To compute the Loan Repayments

R= or R=
 EXAMPLE #3
A person takes out a loan of 100,000 which needs to be repaid in 5 years.
The interest rate is 16% percent per annum compounded monthly. What is
the outstanding balance after 2 years?
Given:
A= 100000 t=5
r=0.16
m=12
R R

R R

R
R
 A=R[

A=2431.81[

A=2431.81[

A=2431.81[

A=2431.81[28.44381091]

A= 69169.94382

A= 69169.94
 EXAMPLE #3
Andrei takes out a loan of 200,000 which needs to be repaid in 5 years. The
interest rate is 10% percent per annum compounded quarterly. If Andrei
does a quarterly payment of 12829.42575 what is the outstanding balance
after 3 years?
Given: S= 200000
t= 6 years
r=0.10
m=4
Outstanding Balance

Outstanding Balance
 Outstanding Balance

Outstanding Balance]

Outstanding Balance

Outstanding Balance
 EXAMPLE #3
Ms. Chan got a business loan worth 900,000. She promise to pay the loan
semi-annually in 3 years. The semi-annual payment is 183,026.37 if the
money is worth 12% annually. How much is the outstanding balance after
the first payment?
Given: A= 900000
t= 3 years
r=0.12
m=2 n=6
p= 1
j= 12%/2 = 0.12/2 = 0.06
A=R []

A= 183,026.37 [

A= 183,026.37 []

A= 183,026.37 []

A= 183,026.37 [4.212363786]

A=770973.6528

A=770973.65
THANK YOU