Need help converting PV formula to PHP

I need help converting the following excel formula to PHP

PV(.0588/12,300,868.0583333)

The output I am expecting is 136,275.88, but the output that I am getting is 590573.166. I have spent hours on it but I can’t seem to find the solution.

This is my code

function FV($rate = 0, $nper = 0, $pmt = 0, $pv =0, $type = 0)
{

    // Validate parameters
    if ($type != 0 && $type != 1) {
        return False;
    }

    // Calculate
    if ($rate != 0.0) {
        return -$pv * pow(1 + $rate, $nper) - $pmt * (1 + $rate * $type) * (pow(1 + $rate, $nper) - 1) / $rate;
    } else {
        return -$pv - $pmt * $nper;
    }
} //  function FV()
echo FV(.0588/12, 300, -868.06);

I have gone through the similar post before but that does not solve.

I have also gone through the PHP site but that does not help either.

Answer

Your algorithm is for FV, but apparently you want it for PV. You’re in luck as Alejandro Pedraza already made a PEAR package Math_Finance for this. Here’s the function extracted to prove that it works (you should include the full Finance.php with its copyright info in your project!).

<?php
    /**
    * Extracted from the PEAR package Math_Finance by Alejandro Pedraza
    * http://pear.php.net/package/Math_Finance
    *
    * Returns the Present Value of a cash flow with constant payments and interest rate (annuities)
    * Excel equivalent: PV
    *
    *   TVM functions solve for a term in the following formula:
    *   pv(1+r)^n + pmt(1+r.type)((1+r)^n - 1)/r) +fv = 0
    *
    *
    * @param float      Interest rate per period 
    * @param int        Number of periods
    * @param float      Periodic payment (annuity)
    * @param float      Future Value
    * @param int        Payment type:
                            FINANCE_PAY_END (default):    at the end of each period
                            FINANCE_PAY_BEGIN:            at the beginning of each period
    * @return float     
    * @static
    * @access public
    */
    function presentValue($rate, $nper, $pmt, $fv = 0, $type = 0)
    {
        if ($nper < 0) {
            return PEAR::raiseError('Number of periods must be positive');
        }
        if ($type != FINANCE_PAY_END && $type != FINANCE_PAY_BEGIN) {
            return PEAR::raiseError('Payment type must be FINANCE_PAY_END or FINANCE_PAY_BEGIN');
        }

        if ($rate) {
            $pv = (-$pmt * (1 + $rate * $type) * ((pow(1 + $rate, $nper) - 1) / $rate) - $fv) / pow(1 + $rate, $nper);
        } else {
            $pv = -$fv - $pmt * $nper;
        }
        return $pv;
    }
?>

Usage:

<?php   
    var_dump( presentValue(.0588/12,300,868.0583333) );
    // float(-136275.88429118)
?>

DEMO

Note:

Like previously mentioned, you should use the full Finance.php file from the PEAR page in order for this to work perfectly (as you might get notices of undefined constants, and it can’t raise errors). You can find the package HERE.

Finance.php on github

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Answer