A sinking fund is a fund set up to accumulate money for a payoff of a bond at some future date. The sinking fund method is one of the several advanced methods of depreciation that are more complex than the straight-line and declining balance methods. Sinking fund method is especially applicable to costly machines in industries. You can use a sinking fund formula to calculate the amount of regular or periodic contributions that go into a particular sinking fund in an organization.

Where,

f = Required Payment

a = Total Accumulated

i = Interest Rate

n = Payment Period

Also, given here related calculator designed based on the sinking fund formula to make the sinking fund calculations in the easier and quicker manner.