# Purchase Order Financing Calculator Online

Last updated on by Editorial Staff

# Purchase Order Financing Calculator

## Guide to Use Purchase Order Financing Calculator

• Choose your desired currency from the available currency options.
• Enter the principal amount. It is the total amount of funding you need.
• Enter the interest rate per annum in percentage.
• Specify the duration of the funding in months.
• Click on ‘Calculate’ to see the total cost payable to the financier.
• Use the ‘Reset’ button to clear all fields and perform new calculations.

### The formula for the Purchase Order Financing Calculator

Total Cost=Principal Amount+(Principal Amount×Interest rate per annaum X Duration)

## What is Purchase Order Financing?

Purchase Order Financing is a financial service tailored for businesses that require funds to fulfill customer orders.

This method is particularly useful for companies that lack the capital to purchase the necessary inventory or cover production costs.

## Who Can Use This Calculator?

• Seasonal Businesses: Useful for companies facing seasonal spikes in order demands.
• Growth-Oriented Companies: Essential for businesses seeking to capitalize on new opportunities without straining cash flow.

## Where Is It Useful?

• Inventory Purchase: To buy the stock needed to fulfill customer orders.
• Manufacturing: For businesses that need to produce goods before receiving payment.
• Supply Chain Financing: Helps in managing supplier payments and maintaining a healthy supply chain.

## FAQs

### What does the ‘Total Amount Refundable’ mean in the calculator’s results?

This is the total amount you will need to repay to the financing company. It includes both the principal borrowed and the interest accrued over the loan period.

### Can this calculator be used for different industries?

Yes, the calculator is versatile and can be used across various industries that utilize purchase order financing.

### Is the interest rate in the calculator fixed or variable?

The calculator uses a fixed interest rate as input. It’s important to know the exact rate your financing company will charge.

### How accurate is the Purchase Order Financing Calculator?

While the calculator provides a good estimate, the actual figures may vary based on specific terms and conditions set by your financing company.

### Does the calculator take into account any fees or additional charges?

No, the calculator only considers the principal amount, interest rate, and loan period. Any additional fees charged by the financing company are not included.

### Can I use this calculator for multiple financing scenarios?

Absolutely. You can modify the inputs to simulate different financing scenarios and compare the outcomes.