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A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately?
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A company create is a sinking one to two lakh in a bank account for 15...
Understanding Sinking Fund Requirements
A sinking fund is a means by which an organization sets aside money over time to fund a future capital expense or repay a long-term debt. In this case, the company aims to accumulate a sum between one to two lakh over 15 years at an interest rate of 6% per annum.
Future Value Calculation
To determine the yearly payment required, we can use the formula for the future value of an annuity:
Where:
- PMT = annual payment
- r = annual interest rate (0.06)
- n = number of years (15)
Estimating Annual Payments
Let’s calculate the annual payments needed to achieve both target amounts (1 lakh and 2 lakh):
1. **For 1 Lakh:**
- Rearranging the formula to find PMT:
- PMT = FV × r / [(1 + r)^n - 1]
- For FV = 1,00,000:
- PMT = 1,00,000 × 0.06 / [(1 + 0.06)^15 - 1]
- PMT ≈ 4,166.67
2. **For 2 Lakhs:**
- For FV = 2,00,000:
- PMT = 2,00,000 × 0.06 / [(1 + 0.06)^15 - 1]
- PMT ≈ 8,333.33
Concluding Annual Payments
In summary, the company needs to make annual payments approximately between:
By consistently investing these amounts annually, the company will build the necessary funds by the end of the 15-year period.
A sinking fund is a means by which an organization sets aside money over time to fund a future capital expense or repay a long-term debt. In this case, the company aims to accumulate a sum between one to two lakh over 15 years at an interest rate of 6% per annum.
Future Value Calculation
To determine the yearly payment required, we can use the formula for the future value of an annuity:
- Future Value (FV) = PMT × [(1 + r)^n - 1] / r
Where:
- PMT = annual payment
- r = annual interest rate (0.06)
- n = number of years (15)
Estimating Annual Payments
Let’s calculate the annual payments needed to achieve both target amounts (1 lakh and 2 lakh):
1. **For 1 Lakh:**
- Rearranging the formula to find PMT:
- PMT = FV × r / [(1 + r)^n - 1]
- For FV = 1,00,000:
- PMT = 1,00,000 × 0.06 / [(1 + 0.06)^15 - 1]
- PMT ≈ 4,166.67
2. **For 2 Lakhs:**
- For FV = 2,00,000:
- PMT = 2,00,000 × 0.06 / [(1 + 0.06)^15 - 1]
- PMT ≈ 8,333.33
Concluding Annual Payments
In summary, the company needs to make annual payments approximately between:
- 4,167 for 1 Lakh
- 8,333 for 2 Lakhs
By consistently investing these amounts annually, the company will build the necessary funds by the end of the 15-year period.
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A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately?
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A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately?.
A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A company create is a sinking one to two lakh in a bank account for 15 year for which the bank offer in dresses 6% per annum the yearly payment to be paid by company is approximately?.
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