Guru Assistance Needed - To Solve Down Payment Calculation Assistance

Hi kgregjackson,

to try calculate the minimum down payment necessary to produce a new minimum adjusted net annual income of $180,000 in Excel, you can try to use the following steps:

1. Create a new Excel spreadsheet and enter the following information into cells A1 to A7:
   
   A1: Purchase Price
   A2: Minimum required down payment
   A3: Maximum down payment
   A4: Minimum adjusted net annual income
   A5: No other changes to expenses will occur
   A6: Current net annual income
   A7: Interest rate and all related expenses

1. In cell B1, enter the purchase price of the business, which is $550,000.

2. In cell B2, enter the minimum required down payment, which is 10%.

3. In cell B3, enter the maximum down payment, which is the amount needed to produce a new net of $180,000.

4. In cell B4, enter the minimum adjusted net annual income, which is $180,000.

5. In cell B5, enter the text "No other changes to expenses will occur".

6. In cell B6, enter your current net annual income, which is $205,523.

7. In cell B7, enter the interest rate and all related expenses, which is .1619.

8. In cell C1, enter the following formula:
   
   

=B1 - ((B3 / 100) * B1)

This formula will calculate the loan amount based on the purchase price and the maximum down payment.

1. In cell C2, enter the following formula:
   
   

=B4 / (1 - B7)​

This formula will calculate the minimum loan amount required to produce the new minimum adjusted net annual income.

1. In cell C3, enter the following formula:
   
   

=C2 - B1​

This formula will calculate the minimum down payment necessary to produce the new minimum adjusted net annual income.

The minimum down payment necessary to produce a new minimum adjusted net annual income of $180,000 is $335,670.33. This can be seen in cell C3 of the spreadsheet.