Night Owl 6/Night Owl's Shareware - PDSI-006 - Night Owl Corp (1990).iso/008a/bfshr302.zip/BIGFIN.DOC

Text File | 1991-12-10 | 28KB | 515 lines

                     BigFin Financial Program Documentation

                                    v 3.xx

                               by Gary D. Moore

                            Copyright (c) 1985-92

              License is granted upon registration of BigFin program










                                  Disclaimer

  Gary D. Moore will not be liable for any damages, including any decrease
  in profits, losses or other incidental or consequential damages arising
  from the use of or inability to use BigFin or related software products,
  even if Gary D. Moore has been advised of the possibility of such damages,
  or for any claim by any other party.  BigFin and related programs are
  distributed with the understanding that if it is used and found to be of
  value, the user will register for a contribution of $20 with the response
  form.  Registration is  appreciated and encouraged to further enhance
  BigFin and software products.  Upon receipt of registration, a diskette
  with the most recent version of BigFin and related programs will be mailed
  to the user.  Registered users will be notified of major revisions and
  updates.  A modest fee will be charged for the updates.  For a large number
  of BigFin copies (and related programs) contact Gary D. Moore at the
  address on the response form about site licensing and/or quantity
  purchases.  BigFin can be used like a book... one person using it at a
  time.  One registration does not mean site license.

                                Introduction

 The history of BigFin (short for Big Financial Program) may not matter to
 most users, so an un-history is provided in the next couple of paragraphs.

 BigFin began as a functional finance program.  Programming is done in a
 structured-top-down-approach.  (Structured programming allows new modules to
 be easily added.)

 The "un-history" of BigFin... on a wintry Michigan night a friend and I were
 trying to determine finance charges.  The available programs had too many
 errors to be reliable (not even close to Barron's figures).  Thus, crash
 code, no frills, no selection menu, etc., and BigFin was born.  Suggestions
 came from associates for more formulas that kept me digging through college
 texts and reviewing notes (have you ever looked at your college notes
 several years after you wrote them...?).  Algorithms were developed for most
 suggestions.  BigFin's un-history hasn't ended yet... it is still evolving.
 If you want to be a part of that history and have a suggestion, please send
 it to the address on the response form.

 Fact... BigFin is a practical, multi-purpose finance program.  Five areas
 are presented with BigFin.  Those areas are (1)_Annuity & Savings,
 (2)_Business & Finance, (3)_Loans, (4)_Miscellaneous, and (5) Currency
 Conversion.  Each of these areas have menus with many formulas available to
 the user.  The fourth menu selection contain programs that do not fit the
 above three categories, but are useful.

                                 BigFin Notes

 Printer.

 Printer control codes were written to enable output via an Epson (or
 compatible) printer, but should work with most printers.  Results can be
 sent to a printer by selecting "Y" (for YES) when asked.  When the screen
 is dumped, the page is ejected from the printer (this also works with laser
 printers).  Note: If the printer is not available, a message displays.
 Turn-on the printer, and press <Return>.  If the printer is not available
 after three cycles, the program will continue (thus, not hang you up like
 some programs).  If a print spooler/buffer is available, the information
 will be sent as if a printer were receiving the data.

 Comment/Memo Note.

 You can "add" a ten line (sixty chars. per line) COMMENT/MEMO/NOTE to the
 print-outs and files created by BigFin.  It's easy, just try it!

 Caution.

 Math is double precision, thus, very accurate.  Nevertheless, because of
 varying standards in calculating, it is my request that results be used for
 estimating only.  There are too many "unknowns" to claim these figures
 accurate in every instance (i.e. late payment charges, early payments,
 surcharges, insurance, taxes, etc.).  Use the results as a guide only, and
 please review the disclaimer at the top of this document.

 System requirements.

 BigFin runs on Monochrome/CGA/EGA/VGA monitors.  The minimum system
 configuration is one floppy disk drive and 256K RAM.  (Hard disk users
 should set the PATH to the directory where BigFin resides, therefore,
 BigFin is available anytime at the system prompt, i.e.
 PATH=C:\;\C:\UTIL;C:\DOS).  BigFin runs flawlessly on virtually all TRUE
 compatibles.  If it does not run on your computer, please send me the
 computer information via the "BigFin Response Form" at the end of the
 document.  Note: Some Leading Edge machines, or near compatibles, do not
 display the menu boxes as they should.

 TSR Programs.

 If you have difficulty running BigFin and your machine is a 100% (PC)
 compatible, a TSR (Terminate and Stay Resident) program may be the culprit.
 A TSR program (STACKEY) prevented BigFin from working on my friend, Dr.
 Jensen's, AT with a speed up crystal.  We thought it was the speed crystal,
 but it was, indeed, the TSR program.  BigFin functions flawlessly with
 SuperKey and Sidekick (by Borland).  Please inform me of any TSR programs
 that conflict, or machines on which BigFin does not work.  Your cooperation
 is appreciated.

 Registration.

 Registered copies of BigFin are available (and encouraged) from the address
 provided on the Response Form.  Please enclose a check or money order for
 $20 (US funds), or what ever you think its worth.  Registered users will be
 notified about major revisions (cost for an update is a nominal shipping
 fee).  An update (for a registered user) can be obtained by sending $5 (US
 funds) at anytime.  Please send the response form at the end of this text,
 and your check plus any comments or suggestions to the address on the form.
 BigFin will help you realize why John Paul Getty said, "...(compound)
 interest is the eighth wonder of the world."  Happy financing!

 If you don't believe that BigFin is worth $20 (US) dollars, or it's against
 your religion to register shareware software, by all means don't.  However,
 the "monies" go to a Memorial College Scholarship Fund.  Thanks for helping!

 Odds & Ends.

 1) Knowledge of Finance and Insurance terminology is helpful.  Please
    reference appropriate dictionaries for unknown terms.

 2) BigFin Bar-Menu allows selection by number (1 to 9, that is) or by using
    cursor keys. The HOME and END keys move the cursor bar to the top and
    bottom of the menu respectively.

 3) Users should know prevailing interest rates (for loans and annuities),
    and the number of annual compounding periods.

 4) DO NOT use a DECIMAL point when entering PERCENTAGES nor a COMMA when
    entering dollar amounts (i.e. 14% is "14", not .14, and $1400 is "1400"
    not 1,400.  However, 10.5% is "10.5", and $99.99 is "99.99").  A decimal
    point in the wrong place will produce an erroneous calculation.  A
    COMMA will also cause an error.

 5) Feedback is welcome.  Positive comments are encouraged, but negative
    constructive opinions are also welcome.  Please be honest about BigFin.
    Writing BigFin is not meant to make millions, but rather provide a good
    product at a reasonable price.  BigFin is marketed via the "Shareware"
    approach.  BigFin is copyrighted and protected under applicable copyright
    laws.  The author is the only legal agent to register and sell BigFin
    unless other agreement has been made.  Fines for illegal copies of any
    software can be as much as 50,000 per violation of the copyright law.

 6) Site registration is available.  For a large number of BigFin copies
    (and related programs) contact Gary D. Moore at the address on the
    response form about site licensing and/or quantity purchases.  BigFin can
    be used like a book... one person using it at a time.  One registration
    does not mean site license.

 7) The <Esc> (Escape key) allows the user to QUIT and return to the Main
    Menu.  Also note, you will be forced to enter a number unless the field
    is a "default" such as, the YEAR and MONTH of the Loan Amortization
    Schedule.  Almost all other fields require a positive number.

 Acknowledgements and Reference.

 Encouragement from friends in the Accounting, Securities, and Insurance
 professions have helped me select several problem solving modules in BigFin.
 BigFin formulas have come from a variety of sources (college math and
 finance professors, the producers of the books listed below, and real-life
 situations).  The following are recommended resources for any library:

  Huffman. Programmed Business Mathematics, Vol. 1 & 2, Fourth Edition, 1980
  Logan. Strategy, Policy and Central Management, Eighth Edition, 1981
  Maaz, Dr. Statistics, Ferris State College, 1981  (Class)
  Maaz, Dr. Statistical Inference, Ferris State College, 1981 (Class)
  Niswonger & Fess. Accounting Principles, 12th Edition, 1978
  Weston & Brigham. Essentials of Managerial Finance, Fifth Edition, 1979


                 BigFin Financial Program (Module) Information

 Annuity & Savings Programs

 The Annuity and Savings Menu consists of several programs.  Results obtained
 from these programs will convince you about the rewards of saving.  It is
 recommended that BigFin users be familiar with terminology in Finance,
 Insurance, and Securities industries.  A brief explanation follows for each
 program module by title (in alphabetical order):

 Earned Interest Calculation - provides the amount earned on an investment
 over a period time at a fixed interest rate.  A great module to prove the
 rewards of saving.  One thousand dollars at 7.5% for 10 years will yield
 $1061.03 in interest (a total of 2,061.03), while $1000 at 7.5% for 15
 years produces $1958.88 in interest (a total of 2,958.88).  Saving for five
 more years at the same rate almost doubled the interest earned.

 Effective Interest of an Investment - depicts actual earning power of an
 investment.  This could be considered to be like the average interest rate
 of an investment.  Use with caution!

 Estimated Income from an Investment - calculates the amount of investment
 needed for a desired withdrawal.  This figure is based on the number of
 withdrawals per year, the interest rate, and number of years to withdraw.
 A great tool for planning cash flows or retirements.

 Future Value of a Single Deposit - shows the future value of an investment
 at a fixed interest rate compounded at regular intervals for a specific
 period of time.  Depicts the power of saving.  This algorithm showed
 friends who just had a baby what a thousand dollars would yield in 18
 years.  A thousand dollars at 7.9% (compounded quarterly) yields $4,016.80
 for college.  Of course, adding to that annually would yield much more.

 Future Value of a Single Deposit (Annualized) - is essentially the same as
 the preceding, but shows the annual growth rate.  This growth is the
 cumulative interest plus the initial investment.  Simple?  Thanks Tom L.
 for the suggestion (others like the results too).  Oh yes, if the investment
 is more than fifteen years, you are asked if you want a printout (hardcopy).
 Pressing anything by "Y" will send the results to the screen.

 Future Value of Regular Deposits - calculates future value of deposits of
 equal value at a fixed interest rate at a known number of compounding
 periods over a time period.  My brother has a hard time squirreling away a
 thousand dollars a year for an IRA, but he can manage $15 per week.  That
 fifteen dollars per week for fifty-two times a year at seven percent
 interest (compounded quarterly) will yield him $33,499.80 at the end of
 twenty years.  The monies can then be transferred to another fund from
 which he can draw a retirement supplement.

 Interest Paid and Interest Earned - derived from my buddy ("JC") who always
 wants to know what monies "borrowed" cost (in interest) compared to the
 same monies "invested."  This module has a right highlight bar showing
 reference to the Loan, Investment, or both.  (Loan payment is automatically
 calculated).  Information regarding the loan and investment must be known.
 The end result clearly shows the cost of monies borrowed verses monies
 invested.

 Investment Interest Rate Calculation - calculates the Effective Annual
 Interest Rate (EAR) of savings or an annuity.  It is akin to the method of
 finding the APR (Annual Percentage Rate) of a loan, but with regard to
 saving.

 Present Value Required for a Future Value - supplies the estimated amount
 of the initial deposit required to obtain a desired future value.  This
 program calculates the present value necessary to attain a future value
 based on the desired future value, compounding periods, fixed interest
 rate, and number of years deposited.  A desired $25,000 in ten years can be
 obtained by investing $12,490.02 at seven percent (compounded quarterly)
 now (the system date appears on the screen).

 Rate Of Return of an Investment - simply, the ROI, or Internal Rate of
 Return.  This equation shows the average interest rate earned by an
 investment.

 Regular Deposits Required for a Future Value - calculates the deposit
 needed to realize a future value.  Deposits are made on a regular basis.
 The interest rate, compounding periods, and time period of the investment
 must be known.  If $25,000 dollars was your goal, a regular deposit of
 $34.94, fifty times a year at seven percent interest (compounded quarterly)
 for ten years will accomplish it.  It's incredible what thirty-five dollars
 a week can do when saved on a regular basis.

 Regular Withdrawals from an Investment - calculates how much can be
 withdrawn from an investment WITHOUT reducing the initial investment.  A
 calculation for the conservative minded who want their nest-egg secure.

 Total Depletion of an Investment - this module is effective when a lump-sum
 is to be spent over a period of time.  The amount is selectable by the user
 as is the time period.  This module demonstrates a good way to see how long
 it takes to spend monies (so that the relatives who didn't earn it, don't
 get it when you are gone).  As the bumper sticker says, "I'm having a ball
 spending my kids inheritance...."  This module was requested by my friend,
 John C.

 Varying Rates, Future Value of a Single Deposit - provides a future value
 of an investment at various rates with the chosen interest rate as a
 midpoint.  The user has the ability to enter one rate (e.g., 10%) plus a
 variance of the rate to compare returns.  An exercise in "What if the rate
 was higher or lower?"  Covers those situations where investment interest
 rates vary (as some "guaranteed" annuities will have in small print).  The
 VARIANCE entered by the user will show the least amount returned to the
 greater amount returned.  Variances are twice the variance below and above
 the entered amount.  This module is a modification of FUTURE VALUE OF A
 SINGLE DEPOSIT.  A practical application is an investment in ZYX Annuity
 Fund guarantees five percent as a low rate of return with nine percent as a
 high.  Ten-thousand is the initial investment to be compounded quarterly
 for ten years.  Entering the information with seven percent as a midpoint
 and one as the variance shows that this investment will yield $16,436.19 at
 five percent (low rate) and $24,351.89 at nine percent (high rate).  This
 variance shows (at a glance) the variance to be expected from this kind of
 investment.  ZYX Annuity is fictitious, but these types of annuities are
 real.  This is a good "ball park" estimator.


 Business and Finance Programs

 This menu is a selection of programs related to the business and finance
 world, but do not fit other areas.  A couple programs deal with statistics
 while others are loners.  This menu area will most likely expand the most
 over the next few years.  A brief explanation follows for each program
 module by title (in alphabetical order):

 Break Even Calculation - shows amount of sales needed to break even on an
 item (or service) when FIXED COSTS, RETAIL PRICE, and VARIABLE costs are
 entered.  Provides the break even amount and number of items (services)
 necessary to sell for suggested profit.

 Discounted Commercial Paper - is a complex financial problem made simple
 after supplying the maturity value of a note, the amount of interest it
 bears, and the number of days until it reaches maturity.  It is a common
 practice to buy Account Receivables at a discount then receive full amount
 "X" days later.

 Earnings Calculation - selection is made for Annual Salary or Hourly Rate.
 Hourly Rate uses the hourly wage, number of hours worked per week, and
 number of weeks worked per year.  Result for both entries show earnings per
 Minute, Hour, Week, Month, Year.

 Mean (Average) & Standard Deviation Calculation - a very simple module that
 allows entry of data to produce an average.  If Linda F. needs to know the
 average of her class test scores, she can input the scores and determine
 the average as well as deviation from the average.

 Population Sample Size Calculation - this is a favorite Stats formula that
 shows the needed number of people/items for sampling based upon a given
 population for a Scientific Systematic Survey.  The user supplies the base
 (number) for sampling (the population/base must be greater than 125).


 Loan Programs

 Loan programs in BigFin are helpful for anyone financing anything. A study
 of the loan modules will open a new view on the world of financing. Because
 modules are simple to understand and easy to use, the explanations are
 brief.  All calculations use simple interest based on the standard formula
 INTEREST equals PRINCIPAL times RATE times TIME with a few more wiz-bangs
 added.  An explanation follows for each program module by title (in
 alphabetical order):

 Annual Percentage Rate (APR) Of A Loan - provides the actual interest rate
 paid on a loan.  This is very helpful when a rate is advertised to be a
 bargain, such as, an automobile ad.  The formula will depict the real
 "cost" of a loan.  Also note:  Credit Life should be added to the loan
 repayment to attain a true and accurate APR.  This formula is the same used
 by The Truth and Lending Law (formula is provided on the screen for those
 questioning its validity).

 (Daily) Interest on Loan Principal Calculation - computes interest paid for
 the number of days (supplied by the user) for a specified loan principal at
 an annual interest rate.  Note: Interest figured on 365 day year.  If zero
 (0) is entered, the user has the option to enter specific dates.
 Calculation for the number of days will derived from the entered dates.

 Final Payment Calculation - will ascertain the last payment amount for a
 loan.  A very simple calculation, but variance occurs because of various
 "hidden and unknown" factors.  Please use with caution... it's an estimate!

 Interest Paid and Interest Earned - Please see explanation in Annuity and
 Savings section.  This selection is common to both areas and appears on
 both menus.

 Loan Amortization Calculation - provides a summary of a loan (a second menu
 allows output to the screen, printer, or ASCII file (on default drive)).
 This loan program is excellent for calculating Land Contracts.
 Calculations have an annual summary for principal and interest paid.
 Output shows Month and Year, Payment, Principal, Interest (per payment),
 Interest-To-Date (ITD), and Balance of the Principal (as of that payment).
 The annual summary is January through December with Year-To-Date totals for
 Principal and the Interest paid.  The "last" payment is designated as LAST,
 and can appear as the thirteenth payment in the final year.  A summary and
 disclaimer appear at the end of the listing.  BALLOON PAYMENT OPTION allows
 calculation by either Number of Payments, or Month and Year of Last Payment.

 Loan Payment Calculation - determines the payment needed to satisfy a loan
 based on interest rate, length (years) of the loan, number of payments per
 year, and the loan principal.  Provides the amount of interest paid.  This
 payment calculation is the same rendered by the two amortization
 calculations in BigFin and Barron's Loan Amortization Schedule (a handy
 schedule to have when BigFin is not available).

 Loan Principal Calculation - calculates the loan principal after entering
 the number of payments per year, amount of payment, interest rate, and the
 length of time to repay the loan.  Real life circumstance... "JC" figures
 he can afford $300 a month for a car.  He knows the interest rate on the
 car is twelve percent.  Based on a four year payment schedule twelve times
 a year, the calculation shows he can borrow $11,392.19.  Be cautious, this
 amount can vary because of "hidden" expenses, late fees, etc., when
 borrowing.  However, it is a good estimation tool.

 Loan Repayment Period - shows the length of time to repay a loan.  The
 user supplies the annual interest rate, the number of years to repay the
 loan, and loan principal.  Be aware of the "hidden" expenses of a loan,
 these costs can alter this calculation.  Several incremental increases
 are provided to show the value of a quicker pay off.

 Lump Sum Payment Calculation - determines the interest and lump sum
 payment.  This is helpful when someone makes a set payment on a loan with
 interest.  A number of farms in Michigan have been sold using this method
 (payment plus interest, paid once a year).  This module was a suggestion by
 Gale F., a life long friend and securities guru.

 Remaining Loan Balance - helps determine the payoff on a loan.  The number
 of payments per year, the interest rate, the amount of the payment must be
 provided.  Also, the payment number for the year and the year of repayment
 (of the loan agreement) will need to be entered.  If you secured a loan for
 your house based on twelve payments per year at ten percent interest at
 $400 per payment on $42,000, and you have made three payments into your
 tenth year, you would owe $32,926.58 on the loan.  Helps to know this
 information if you are thinking about re-financing or obtaining a second
 mortgage.  Hidden expenses can and will throw this figure off, please use
 this as a guide only.

 Variable Payment Loan Amortization Calculation - provides a summary of a
 loan (a second menu allows selection of output to the screen, printer, or
 an ASCII file (on the default drive)).  This loan program is very helpful
 to calculate loans paid bimonthly, every two weeks, or when you want to
 make thirteen payments a year verses twelve. Output displays Payment and
 Year, Payment Amount, Principal Paid, Interest Paid, Interest-To-Date (ITD),
 and Balance of the Principal (as of that payment).  Annual summary is
 January to December with Year-To-Date totals for Principal and the Interest
 paid that year.  A summary and disclaimer appear at the end of the listing.
 (This was suggested by a friend to ease his land contract woes in figuring
 variable payment amounts.  Good suggestion, Dick!)  Caution:  When using
 this program, the payments begin at the first of the month of the system
 date, therefore, it may look like an extra payment is being made that year.
 Payments are numbered rather than having the Month displayed.


 Miscellaneous Programs

 The miscellaneous programs are financial and business related formulas that
 do not fit other subdivisions in BigFin.  However, they are handy.  A brief
 explanation is provided for each module by title in alphabetical order:

 Age Calculation - input your birthday (MMDDYY), and you have the years,
 or hours, or minutes, or seconds you have lived.  Great for kiddies who
 MUST know how many minutes they are old (the rest of us want to forget).

 Circle, Area & Circumference Calculation - provide the radius of a circle,
 and several variations of the results are provided.

 Cubic Yard Calculation - is very useful when estimating the amount of
 concrete or fill need.  If the total square feet is known, it can be
 entered.  If not, the user is prompted for the length and width.  The depth
 is also required.  For example, a person would like to fill area in their
 back yard 6 inches deep.  The area is 100 by 90 feet (1900 square feet).
 The cost of the fill is five dollars per yard.  This area at six inches
 deep will take 166.67 cubic yards, and cost is approximately $833.33.  If
 the cost of the fill is not known, the equation will still function, but
 without a cost estimation.

 Fuel Consumption and Cost Calculation - will show the number of units
 (gallons/liters) and the cost per each unit based on entered information.
 The calculation figures the cost per mile and kilometer.

 Home Owner's Cost Calculation (LPT) - was essentially a Public Domain
 program that has been completely altered to produce the output to the CRT
 screen or printer.  These calculations are based on a single residence tax
 deduction, and provide estimation of savings by realization of gain through
 increase property value, reduction of mortgage principal, and recovery based
 on a person's tax bracket.  These calculations are EXTIMATES, and are to be
 used as a guide for actual cost savings.  Please..., use this for an
 estimate only!

 How To Become A Registered User - hopefully, everyone will read this first
 and immediately send their registration fee to the author.  This selection
 displays an address with which to register BigFin if the documents are not
 available.

 Square Feet to Acreage Calculation - a simple equation to determine
 acreage.  If total square feet is known, it can be entered; length and
 width are requested otherwise.  Acreage is return to the hundredth.  A lot
 90 feet by 100 feet is .21 acres.

 Square Feet to Square Yard - computes number of yards of material need to
 cover an area.  If total square feet is known, it can be entered.  Cost per
 square yard can also be entered.

 Systems Statistics - is the system configuration summary of the computer on
 which BigFin is running.  It is essentially the same code used in the
 stand-a-lone version, SYSINFO.EXE.

 Time Transfer Calculation - is helpful to determine time needed to transfer
 a file via a modem.  Baud rate is selectable.  Cost per minute can also be
 entered (optional).


 DOCUMENT Menu - displays this text to screen within BigFin, and prints it
 to LPT1: by selection.

 Change Screen Type - gives composite screen users better color contrast
 when reading the Documents within BigFin.

 BigResp Form can be printed by selecting it on the Document Menu.  The form
 can be folded, then sent with the appropriate First Class postage.


 CURRENCY CONVERSION Menu - Provides means to convert various "world"
 currencies to U.S.  The "exchange amount" has been determined by the "date"
 specified in the program.  However, the "user" can modify the amount as
 indicated.  Other "exchanges" can be added as suggested.

 End of BigFin.DOC