Coefficient of Annual Sinking Fund given Sinking Fund Solution

STEP 0: Pre-Calculation Summary
Formula Used
Coefficient of Sinking Fund = Annual Installment/Sinking Fund
Ic = Ia/S
This formula uses 3 Variables
Variables Used
Coefficient of Sinking Fund - Coefficient of Sinking Fund is the ratio of the annual installment required to that of the amount of the sinking fund.
Annual Installment - Annual Installment means a series of amounts to be paid annually over a predetermined period of years in substantially equal periodic payments.
Sinking Fund - Sinking Fund is the amount that has to be set aside out of the gross income so that at the end of the lifetime of the building, the fund should accumulate to the initial cost of the building.
STEP 1: Convert Input(s) to Base Unit
Annual Installment: 600 --> No Conversion Required
Sinking Fund: 8000 --> No Conversion Required
STEP 2: Evaluate Formula
Substituting Input Values in Formula
Ic = Ia/S --> 600/8000
Evaluating ... ...
Ic = 0.075
STEP 3: Convert Result to Output's Unit
0.075 --> No Conversion Required
FINAL ANSWER
0.075 <-- Coefficient of Sinking Fund
(Calculation completed in 00.004 seconds)

Credits

Created by Chandana P Dev
NSS College of Engineering (NSSCE), Palakkad
Chandana P Dev has created this Calculator and 500+ more calculators!
Verified by Mithila Muthamma PA
Coorg Institute of Technology (CIT), Coorg
Mithila Muthamma PA has verified this Calculator and 700+ more calculators!

17 Valuation Engineering Calculators

Annual Installment for Sinking Fund
Go Annual Installment = Sinking Fund*Rate of Interest/((1+Rate of Interest)^Number of Years Money is Invested-1)
Coefficient of Annual Sinking Fund
Go Coefficient of Sinking Fund = Rate of Interest/((1+Rate of Interest)^Number of Years Money is Invested-1)
Annual Sinking Fund using Sinking Fund Method
Go Annual Sinking Fund = Rate of Interest/((1+Rate of Interest)^Life of Asset in Years-1)
Percentage Rate of Annual Depreciation
Go Percentage Rate of Annual Depreciation = 1-(Scrap Value/Original Cost)
Years Purchase when Sinking Fund is Recovered
Go Years Purchase = 1/(Rate of Interest on Capital+Rate of Sinking Fund)
Rate of Sinking Fund given YP
Go Rate of Sinking Fund = (1/Years Purchase)-Rate of Interest on Capital
Coefficient of Annual Sinking Fund given Sinking Fund
Go Coefficient of Sinking Fund = Annual Installment/Sinking Fund
Annual Installment given Sinking Fund
Go Annual Installment = Coefficient of Sinking Fund*Sinking Fund
Sinking Fund for Buildings
Go Sinking Fund = Annual Installment/Coefficient of Sinking Fund
Capitalized Value using Profit Based Valuation
Go Capitalized Value = Net Rental Income*Years Purchase
Capitalized Value
Go Capitalized Value = Net Rental Income*Years Purchase
Gross Rent given Net Rent in Rental Method
Go Gross Rent = Net Rental Income+Outgoings of Repairs
Net Rent using Rental Method of Valuation
Go Net Rental Income = Gross Rent-Outgoings of Repairs
Outgoings using Rental Method
Go Outgoings of Repairs = Gross Rent-Net Rental Income
Net Income using Profit Based Valuation
Go Net Income = Gross Income-Outgoings of Repairs
Rate of Interest given Years Purchase
Go Rate of Interest = 100/Years Purchase
Years Purchase
Go Years Purchase = 100/Rate of Interest

Coefficient of Annual Sinking Fund given Sinking Fund Formula

Coefficient of Sinking Fund = Annual Installment/Sinking Fund
Ic = Ia/S

What is the Purpose of a Sinking Fund?

A sinking fund is a strategic way to save money by setting aside a little bit each month. Sinking funds work like this: Every month, you'll set money aside in one or multiple categories to be used at a later date. With a sinking fund, you save up a small amount each month for a certain block of time before you spend.

What are the Advantages of Sinking Funds?

1. Brings in investors: Investors are very well aware that companies or organizations with a large amount of debt are potentially risky. However, once they know that there is an established sinking fund, they will see a certain level of protection for them so that in the case of a default or bankruptcy, they will still be able to get their investment back.
2. The possibility of lower interest rates: A company with poor credit ratings will find it difficult to attract investors unless they offer higher interest rates. A sinking fund offers alternative protection for investors so that companies can offer lower interest rates.
3. Stable finances: A company’s economic situation is not always definite, and certain financial issues can shake its stable ground. However, with a sinking fund, the ability of a company to repay its debts and buy back bonds will not be compromised.

How to Calculate Coefficient of Annual Sinking Fund given Sinking Fund?

Coefficient of Annual Sinking Fund given Sinking Fund calculator uses Coefficient of Sinking Fund = Annual Installment/Sinking Fund to calculate the Coefficient of Sinking Fund, The Coefficient of Annual Sinking Fund given Sinking Fund formula is defined as the ratio of the annual installment to that of the sinking fund amount. Coefficient of Sinking Fund is denoted by Ic symbol.

How to calculate Coefficient of Annual Sinking Fund given Sinking Fund using this online calculator? To use this online calculator for Coefficient of Annual Sinking Fund given Sinking Fund, enter Annual Installment (Ia) & Sinking Fund (S) and hit the calculate button. Here is how the Coefficient of Annual Sinking Fund given Sinking Fund calculation can be explained with given input values -> 0.075 = 600/8000.

FAQ

What is Coefficient of Annual Sinking Fund given Sinking Fund?
The Coefficient of Annual Sinking Fund given Sinking Fund formula is defined as the ratio of the annual installment to that of the sinking fund amount and is represented as Ic = Ia/S or Coefficient of Sinking Fund = Annual Installment/Sinking Fund. Annual Installment means a series of amounts to be paid annually over a predetermined period of years in substantially equal periodic payments & Sinking Fund is the amount that has to be set aside out of the gross income so that at the end of the lifetime of the building, the fund should accumulate to the initial cost of the building.
How to calculate Coefficient of Annual Sinking Fund given Sinking Fund?
The Coefficient of Annual Sinking Fund given Sinking Fund formula is defined as the ratio of the annual installment to that of the sinking fund amount is calculated using Coefficient of Sinking Fund = Annual Installment/Sinking Fund. To calculate Coefficient of Annual Sinking Fund given Sinking Fund, you need Annual Installment (Ia) & Sinking Fund (S). With our tool, you need to enter the respective value for Annual Installment & Sinking Fund and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.
How many ways are there to calculate Coefficient of Sinking Fund?
In this formula, Coefficient of Sinking Fund uses Annual Installment & Sinking Fund. We can use 1 other way(s) to calculate the same, which is/are as follows -
  • Coefficient of Sinking Fund = Rate of Interest/((1+Rate of Interest)^Number of Years Money is Invested-1)
Let Others Know
Facebook
Twitter
Reddit
LinkedIn
Email
WhatsApp
Copied!