Sinking Fund Formula

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.

Formula:

f = a × ( ( i / 100) / ( ( ( 1 + ( i / 100 ) )n) - 1) )


Where,

f = Required Payment
a = Total Accumulated
i = Interest Rate
n = Payment Period

Related Calculator:

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


english Calculators and Converters


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