For the calculation of 4% interest per annum on a loan, use the given formula:

Principal amount = Periodic payment/(1 + interest)

Put the total principal amount in the left side of the equation, 0.04 in the place of interest, number of years in place of 'n' and you can find interest and principal or periodic payment.

Principal amount = Periodic payment/(1 + interest)

^{n}Put the total principal amount in the left side of the equation, 0.04 in the place of interest, number of years in place of 'n' and you can find interest and principal or periodic payment.