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Sinking Funds
When a specified amount of money is needed  at a specified future date, it is a good practice to accumulate systematically a fund by means of equal periodic deposits. such a fund is called a sinking fund.

sinking funds are used to payoff debts, to redeem bond issues, to replace worn out equipment, to buy new equipment, or in one of the depreciation method.

A schedule showing how a sinking fund accumulates to the desired amount is called a sinking fund schedule.

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