Example of sinking fund factor, Financial Accounting

How much must you save annually in order to accumulate Rs. 20, 00,000 by the ending of 10 years, whether the saving earns an interest of 12%?         

   Solution:

A = [k/((1 + k)n - 1)]FVAn    

= Rs. 20,000 * 1/FVIFA12%,10

= Rs. 20,000 * 1/17.548

= 1, 11,400

Posted Date: 4/9/2013 2:39:56 AM | Location : United States







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