Calculate the Future Investment Value and the Compound Interest earned by a principal of 1.15 (Dollar, Euro, Pound, ...), initial amount of money lent, deposited or borrowed, with a duration of 2 years, 1 month and 14 days, 2.00% annual interest rate, compounded daily (360 times a year)

Calculation formula. Used notations. Project Breakdown.


[1] Calculation method used: 30 / 360

Number of days in a month = 30


Number of days in a year = 360


[2] Future Investment Value, FV
Calculation formula:

FV =


P × (1 + r/n)n×t


FV, Future Investment Value


P, Principal (initial amount), P = 1.15


r, Annual compound interest rate, r = 2.00%


n, Number of times the interest compounds during a year
Compound frequency: daily (360 times a year)
n = 360


r/n = 2.00%/360 = (2.00 ÷ 100)/360 = 2.00/(100 × 360)
r/n = 0.000055555556


t, Duration of the investment
n×t, Duration of the investment, related to n

n×t =

+ 2 years × 360 days / year
+ 1 month × 30 days / month
+ 14 days

n×t = 764 days


>> Compound Interest: what is it, how is it calculated?


Calculate FV
Substitute for the values in the FV formula:

FV =


P × (1 + r/n)n×t =


1.15 × (1 + 0.000055555556)764 =


1.15 × 1.000055555556764 =


1.15 × 1.043356860694 ≈


1.2


[3] Compound interest amount, CI
Calculation formula

CI = FV - P


CI, compound interest amount

FV, Future Investment Value

P, Principal (initial amount)


CI ≈


1.2 - 1.15 ≈


0.05


[4] Project Breakdown. Monthly.

Interest compounded: daily (360 times a year).

Month Days Interest Total
interest
Balance
0 0 -- -- 1.15
1 30 0.00 0.00 1.15
2 30 0.00 0.00 1.15
3 30 0.00 0.01 1.16
4 30 0.00 0.01 1.16
5 30 0.00 0.01 1.16
6 30 0.00 0.01 1.16
7 30 0.00 0.01 1.16
8 30 0.00 0.02 1.17
9 30 0.00 0.02 1.17
10 30 0.00 0.02 1.17
11 30 0.00 0.02 1.17
12 30 0.00 0.02 1.17
13 30 0.00 0.03 1.18
14 30 0.00 0.03 1.18
15 30 0.00 0.03 1.18
16 30 0.00 0.03 1.18
17 30 0.00 0.03 1.18
18 30 0.00 0.04 1.19
19 30 0.00 0.04 1.19
20 30 0.00 0.04 1.19
21 30 0.00 0.04 1.19
22 30 0.00 0.04 1.19
23 30 0.00 0.04 1.19
24 30 0.00 0.05 1.20
25 30 0.00 0.05 1.20
26 14 0.00 0.05 1.20
Month Days Interest Total
interest
Balance

Answer:

Principal (initial amount) = 1.15

Future Investment Value = 1.20

Compound interest amount = 0.05


More calculations on Compound Interest and Future Investment Value:

Calculator: Compound Interest, Future Investment Value

FV = P × (1 + r/n)n×t + A × [(1 + r/m)m×t - 1] ÷ r/m

FV = Future Value of investment

P = Principal amount invested (the original contribution)

A = Regular contribution (additional money added periodically to the initial investment, P)

r = Annual Interest Rate the investment is earning

n = Number of times the interest compounds during a year

m = Number of times the regular contribution is made during a year

t = Number of years the investment is going to be active

t and r are expressed using the same time units

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