Imputed Interest Calculator

Formula

To calculate the Imputed Interest ($I$):

\[ I = P \times \left(\frac{r}{100}\right) \times t \]

Where:

$I$ is the imputed interest (\$)
$P$ is the principal amount (\$)
$r$ is the minimum interest rate (\%)
$t$ is the number of years of the loan or bond

What is Imputed Interest?

Imputed interest is defined as the total interest amount that a lender estimates it will collect on a loan or bond, without regard to the amount that the lender would receive.

Example Calculation 1

Let's assume the following values:

Principal Amount ($P$) = $1,000
Minimum Interest Rate ($r$) = 5%
Number of Years ($t$) = 3 years

Using the formula:

\[ I = 1000 \times \left(\frac{5}{100}\right) \times 3 = 150 \text{ dollars} \]

The imputed interest is $150.

Example Calculation 2

Let's assume the following values:

Principal Amount ($P$) = $2,000
Minimum Interest Rate ($r$) = 4%
Number of Years ($t$) = 5 years

Using the formula:

\[ I = 2000 \times \left(\frac{4}{100}\right) \times 5 = 400 \text{ dollars} \]

The imputed interest is $400.