Sharp EL-738 Financial Calculator
Comprehensive Guide to the Sharp EL-738 Financial Calculator
The Sharp EL-738 is one of the most powerful and versatile financial calculators available, designed to handle complex financial computations with ease. Whether you’re a student, financial professional, or business owner, this calculator provides essential functions for time value of money calculations, cash flow analysis, bond calculations, and more.
Key Features of the Sharp EL-738
- Time Value of Money (TVM) Calculations: Compute present value, future value, interest rates, payments, and number of periods for loans and investments.
- Amortization Schedules: Generate complete payment schedules for loans with principal and interest breakdowns.
- Cash Flow Analysis: Calculate Net Present Value (NPV) and Internal Rate of Return (IRR) for uneven cash flows.
- Bond Calculations: Determine bond prices, yields, and accrued interest.
- Depreciation Schedules: Calculate straight-line, declining balance, and sum-of-years’ digits depreciation.
- Statistical Functions: Perform linear regression, standard deviation, and other statistical analyses.
- Cost-Sell-Margin Calculations: Quickly determine profit margins and markups.
- Date Calculations: Compute days between dates and other date-related functions.
How to Use the Sharp EL-738 for Basic Financial Calculations
- Turning On the Calculator: Press the ON/C key to turn on the calculator. The display will show “0.00” indicating it’s ready for input.
- Setting the Number of Decimal Places: Press 2ndF then DEC to set the number of decimal places (0-9). For financial calculations, 2 decimal places is typically appropriate.
- Basic Arithmetic: Perform addition, subtraction, multiplication, and division using the standard keys. The calculator follows standard order of operations.
- Percentage Calculations: To calculate percentages, enter the base number, press ×, enter the percentage, then press %. For example, to calculate 15% of 200: 200 × 15 % = 30.
Advanced Financial Functions
Time Value of Money (TVM) Calculations
The TVM functions are among the most powerful features of the EL-738. These allow you to calculate any one variable when you know the other four:
- N = Number of periods
- I/Y = Interest rate per period
- PV = Present value
- PMT = Payment per period
- FV = Future value
Example: Calculating Future Value of an Investment
- Press 2ndF then CLR TVM to clear previous TVM calculations.
- Enter the number of periods (N). For example, for 5 years with monthly compounding, enter 5 × 12 = 60.
- Enter the interest rate per period (I/Y). For an annual rate of 6%, enter 6 ÷ 12 = 0.5 for monthly compounding.
- Enter the present value (PV) if applicable. For a $10,000 initial investment, enter 10000 and press PV.
- Enter any periodic payments (PMT). For monthly contributions of $200, enter 200 and press PMT (use +/- key if it’s an outflow).
- Press FV to calculate the future value.
Cash Flow Analysis (NPV and IRR)
The EL-738 can handle uneven cash flows for up to 24 periods, making it ideal for analyzing investment opportunities with varying returns.
| Function | Description | Example Use Case |
|---|---|---|
| NPV | Calculates Net Present Value of a series of cash flows | Evaluating whether to invest in a new business project |
| IRR | Calculates Internal Rate of Return for cash flows | Comparing the profitability of different investments |
| NFV | Calculates Net Future Value | Projecting the future value of an investment portfolio |
| PB (Payback) | Calculates the payback period | Determining how long until an investment breaks even |
Bond Calculations with the Sharp EL-738
The bond functions allow you to calculate:
- Bond price given yield to maturity
- Yield to maturity given bond price
- Accrued interest between coupon dates
- Modified duration and convexity
Example: Calculating Bond Price
- Press 2ndF then BOND to enter bond mode.
- Enter the settlement date (format: MM.DDYYYY).
- Enter the maturity date.
- Enter the coupon rate (annual percentage).
- Enter the yield to maturity.
- Enter the redemption value (usually 100 for par value).
- Press PRICE to calculate the bond price per $100 face value.
Depreciation Calculations
The EL-738 offers three depreciation methods:
- Straight-Line (SL): Equal depreciation each period
- Declining Balance (DB): Accelerated depreciation (150% or 200% declining balance)
- Sum-of-Years’ Digits (SYD): Accelerated depreciation based on remaining life
| Method | Formula | When to Use |
|---|---|---|
| Straight-Line | (Cost – Salvage Value) / Useful Life | When asset provides equal benefits each year |
| 150% Declining Balance | 1.5 × (1/Useful Life) × Book Value | When asset loses value quickly in early years |
| 200% Declining Balance | 2 × (1/Useful Life) × Book Value | For assets that become obsolete quickly |
| Sum-of-Years’ Digits | (Remaining Life / SYD) × (Cost – Salvage) | When asset productivity decreases over time |
Statistical Functions
The EL-738 includes comprehensive statistical functions:
- Single-Variable Statistics: Mean, standard deviation, variance, sum, sum of squares
- Linear Regression: Slope, intercept, correlation coefficient (r), coefficient of determination (r²)
- Forecasting: Predict y-values for given x-values based on regression
- Combinations and Permutations: For probability calculations
Cost-Sell-Margin Calculations
Quickly calculate:
- Cost given selling price and margin (CST)
- Selling price given cost and margin (SEL)
- Margin given cost and selling price (MAR)
Example: Calculating Selling Price
- Enter the cost (e.g., 50 for $50).
- Enter the desired margin (e.g., 30 for 30%).
- Press SEL to calculate the selling price ($65 in this case).
Date Calculations
The EL-738 can:
- Calculate days between two dates (DATE)
- Add or subtract days from a date (DATE+)
- Determine day of the week for any date
Comparing the Sharp EL-738 to Other Financial Calculators
| Feature | Sharp EL-738 | HP 12C |
|---|---|---|
| Display | 2-line LCD (12 digits) | 1-line LCD (10 digits) |
| Programmability | No | Yes (RPN) |
| Cash Flow Analysis | 24 uneven cash flows | 20 uneven cash flows |
| Bond Calculations | Yes (price, yield, accrued interest) | Yes (basic) |
| Depreciation | SL, DB, SYD | SL, DB, SYD |
| Statistical Functions | Comprehensive (regression, forecasting) | Basic |
| Price | $$ | $$$ |
| Feature | Sharp EL-738 | TI BA II Plus |
|---|---|---|
| Display | 2-line LCD | 1-line LCD |
| TVM Calculations | Yes | Yes |
| Cash Flow Analysis | 24 cash flows | 32 cash flows |
| Bond Calculations | Advanced (price, yield, accrued interest) | Basic (price, yield) |
| Depreciation | SL, DB, SYD | SL, DB |
| Statistical Functions | Comprehensive | Basic |
| Cost-Sell-Margin | Yes | No |
Tips for Getting the Most Out of Your Sharp EL-738
- Use the Grand Total (GT) Function: Keep a running total of calculations by pressing GT after each operation.
- Store and Recall Values: Use the STO and RCL keys to store frequently used values in memory (A, B, C, D, E, F, X, Y).
- Chain Calculations: The EL-738 uses algebraic logic, so you can chain calculations together (e.g., 5 + 3 × 2 = 11).
- Use the 2ndF Key: Many advanced functions are accessed via the blue 2ndF key. Look for blue labels above keys for these functions.
- Clear Memories Regularly: Press 2ndF then CLR MEM to clear all stored values when starting new calculations.
- Practice with Real Examples: The best way to master the calculator is to work through real financial problems.
- Keep the Manual Handy: The EL-738 has many features – refer to the manual when you encounter unfamiliar functions.
Common Mistakes to Avoid
- Not Clearing TVM Registers: Always clear TVM registers (2ndF then CLR TVM) before starting new time value calculations.
- Incorrect Cash Flow Signs: Remember that inflows are positive and outflows are negative in cash flow analysis.
- Mismatched Compounding Periods: Ensure your compounding period (annually, monthly, etc.) matches your interest rate entry.
- Forgetting to Set P/Y: The payments per year (P/Y) setting affects many calculations. Press 2ndF then P/Y to set this correctly.
- Ignoring Day Count Conventions: For bond calculations, be aware of whether you’re using 30/360, actual/actual, or other day count conventions.
- Not Checking Calculation Mode: The calculator has different modes (normal, statistic, etc.) that affect how inputs are interpreted.
Learning Resources for the Sharp EL-738
To master the Sharp EL-738, consider these authoritative resources:
- U.S. Securities and Exchange Commission (SEC) – For official financial regulations and calculation standards that may apply to your financial analysis.
- Federal Reserve Economic Data (FRED) – Access economic data that you can analyze using your EL-738’s statistical functions.
- Khan Academy – Finance Courses – Free educational resources that complement the calculator’s financial functions (note: while not a .gov or .edu, Khan Academy is a highly respected non-profit educational organization).
- Internal Revenue Service (IRS) – For tax-related calculations and depreciation schedules that you can compute with the EL-738.
Maintenance and Care
To ensure your Sharp EL-738 remains in good working condition:
- Store it in a protective case when not in use
- Avoid exposure to extreme temperatures or moisture
- Clean the keys gently with a slightly damp cloth (never use abrasive cleaners)
- Replace the battery when the display becomes dim (uses one LR44 battery)
- Press the reset button on the back if the calculator becomes unresponsive
Professional Applications of the Sharp EL-738
Financial professionals across various industries rely on the EL-738 for critical calculations:
Real Estate Professionals
- Calculate mortgage payments and amortization schedules
- Determine internal rates of return for investment properties
- Analyze cash flows for rental properties
- Compute net present values for development projects
Financial Analysts
- Evaluate investment opportunities using NPV and IRR
- Analyze bond portfolios and yield curves
- Perform sensitivity analysis on financial models
- Calculate weighted average cost of capital (WACC)
Accountants
- Compute depreciation schedules for assets
- Calculate loan amortization for business loans
- Determine present values of future liabilities
- Analyze lease vs. buy decisions
Business Owners
- Evaluate equipment purchase decisions
- Analyze pricing strategies using cost-sell-margin functions
- Project future cash flows for business planning
- Calculate break-even points for new products
Advanced Techniques with the Sharp EL-738
Breakeven Analysis
Use the cost-sell-margin functions to determine:
- Required sales volume to achieve target profit
- Impact of price changes on profitability
- Effect of cost changes on break-even points
Loan Comparison
Compare different loan options by:
- Calculating total interest paid for each option
- Determining the effective annual rate (EAR) for loans with different compounding periods
- Generating amortization schedules to compare payment structures
Retirement Planning
Use the TVM functions to:
- Calculate required monthly savings to reach a retirement goal
- Determine how long retirement savings will last given withdrawal rates
- Analyze the impact of different return assumptions on retirement nest eggs
Business Valuation
Apply the cash flow functions to:
- Calculate terminal values using perpetuity growth models
- Determine discount rates for valuation models
- Analyze the sensitivity of valuations to different growth assumptions
Troubleshooting Common Issues
| Issue | Possible Cause | Solution |
|---|---|---|
| Incorrect TVM results | Wrong sign convention (inflows vs. outflows) | Ensure all cash inflows are positive and outflows are negative |
| Error messages | Invalid input or calculation | Check all inputs and clear registers (2ndF then CLR TVM) |
| Display shows unexpected values | Wrong calculation mode | Press 2ndF then MODE to check/change calculation mode |
| Bond calculations not matching expectations | Incorrect day count convention | Press 2ndF then DAY to set the correct day count method |
| Statistical functions not working | Data not entered correctly | Clear statistical registers (2ndF then CLR STAT) and re-enter data |
Final Thoughts on the Sharp EL-738
The Sharp EL-738 stands out as one of the most comprehensive financial calculators available, offering an impressive array of functions at a reasonable price point. Its intuitive interface makes it accessible to beginners while its advanced features satisfy the needs of financial professionals.
Whether you’re studying for the CFA or CPA exams, managing investments, running a business, or simply planning your personal finances, the EL-738 provides the computational power you need. The key to mastering this calculator is practice – the more you use its various functions, the more comfortable and proficient you’ll become.
Remember that while the calculator can perform complex computations, it’s essential to understand the financial concepts behind the calculations. The EL-738 is a tool that enhances your financial analysis capabilities, but it doesn’t replace the need for sound financial knowledge and judgment.
For those considering purchasing a financial calculator, the Sharp EL-738 offers excellent value compared to more expensive models with similar functionality. Its durability, comprehensive feature set, and ease of use make it a smart investment for anyone serious about financial calculations.