Years Purchase when Sinking Fund is Recovered Calculator

✖Rate of Interest on Capital is the product of amount of capital, interest per annum and the years or period of interest.ⓘ Rate of Interest on Capital [I_p]			+10% -10%
✖Rate of Sinking Fund is the fund that is created and set up purposely for repaying debt.ⓘ Rate of Sinking Fund [I_s]			+10% -10%

✖Years Purchase in perpetuity is defined as the capital sum required to be invested in order to receive a net annual income of rs/- 1 at a certain rate of interest.ⓘ Years Purchase when Sinking Fund is Recovered [Y]

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Formula

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Years Purchase when Sinking Fund is Recovered

Formula

`"Y" = 1/("I"_{"p"}+"I"_{"s"})`

Example

`"11.0011"=1/("0.08"+"0.0109")`

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Years Purchase when Sinking Fund is Recovered Solution

STEP 0: Pre-Calculation Summary

Formula Used

Years Purchase = 1/(Rate of Interest on Capital+Rate of Sinking Fund)
Y = 1/(I_p+I_s)
This formula uses 3 Variables

Variables Used

Years Purchase - Years Purchase in perpetuity is defined as the capital sum required to be invested in order to receive a net annual income of rs/- 1 at a certain rate of interest.
Rate of Interest on Capital - Rate of Interest on Capital is the product of amount of capital, interest per annum and the years or period of interest.
Rate of Sinking Fund - Rate of Sinking Fund is the fund that is created and set up purposely for repaying debt.

STEP 1: Convert Input(s) to Base Unit

Rate of Interest on Capital: 0.08 --> No Conversion Required
Rate of Sinking Fund: 0.0109 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

Y = 1/(I_p+I_s) --> 1/(0.08+0.0109)

Evaluating ... ...

Y = 11.001100110011

STEP 3: Convert Result to Output's Unit

11.001100110011 --> No Conversion Required

FINAL ANSWER

11.001100110011 ≈ 11.0011 <-- Years Purchase

(Calculation completed in 00.004 seconds)

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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

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< 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

Years Purchase when Sinking Fund is Recovered Formula

Years Purchase = 1/(Rate of Interest on Capital+Rate of Sinking Fund)
Y = 1/(I_p+I_s)

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.

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.

How to Calculate Years Purchase when Sinking Fund is Recovered?

Years Purchase when Sinking Fund is Recovered calculator uses Years Purchase = 1/(Rate of Interest on Capital+Rate of Sinking Fund) to calculate the Years Purchase, The Years Purchase when Sinking Fund is Recovered formula is defined as the capital sum required to be invested in order to receive a net annual income of Rs/- 1 at a certain rate of interest. Years Purchase is denoted by Y symbol.

How to calculate Years Purchase when Sinking Fund is Recovered using this online calculator? To use this online calculator for Years Purchase when Sinking Fund is Recovered, enter Rate of Interest on Capital (I_p) & Rate of Sinking Fund (I_s) and hit the calculate button. Here is how the Years Purchase when Sinking Fund is Recovered calculation can be explained with given input values -> 11.0011 = 1/(0.08+0.0109).

FAQ

What is Years Purchase when Sinking Fund is Recovered?

The Years Purchase when Sinking Fund is Recovered formula is defined as the capital sum required to be invested in order to receive a net annual income of Rs/- 1 at a certain rate of interest and is represented as Y = 1/(I_p+I_s) or Years Purchase = 1/(Rate of Interest on Capital+Rate of Sinking Fund). Rate of Interest on Capital is the product of amount of capital, interest per annum and the years or period of interest & Rate of Sinking Fund is the fund that is created and set up purposely for repaying debt.

How to calculate Years Purchase when Sinking Fund is Recovered?

The Years Purchase when Sinking Fund is Recovered formula is defined as the capital sum required to be invested in order to receive a net annual income of Rs/- 1 at a certain rate of interest is calculated using Years Purchase = 1/(Rate of Interest on Capital+Rate of Sinking Fund). To calculate Years Purchase when Sinking Fund is Recovered, you need Rate of Interest on Capital (I_p) & Rate of Sinking Fund (I_s). With our tool, you need to enter the respective value for Rate of Interest on Capital & Rate of 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 Years Purchase?

In this formula, Years Purchase uses Rate of Interest on Capital & Rate of Sinking Fund. We can use 1 other way(s) to calculate the same, which is/are as follows -

Years Purchase = 100/Rate of Interest

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