sinking fund

sinking fund
Assets and their earnings earmarked for the retirement of bonds or other long-term obligations. An obligation sometimes imposed pursuant to the issuance of debt securities or preferred shares by which the issuer is required each year to set aside a certain amount to enable the issuer to retire the securities when they mature. A sinking fund may be allowed to accumulate or may be used each year to redeem a portion of the outstanding securities. A fund (usually invested), which will be used to replace improvements as needed. Most commonly set aside from the income of income producing property. A fund arising from particular taxes, imposts or duties, which is appropriated toward the payment of the interest due on a public loan, and for the payment of the principal. Talbott v. City of Lyons, 171 Neb. 186, 105 N.W.2d 918, 925.
In general accounting, segregated assets that are being accumulated for a specific purpose. In governmental accounting, a fund established to accumulate resources for the retirement of bonds but not for the payment of interest, which is handled through the general fund or a special revenue fund
+ sinking fund
The aggregate of sums of money (as those arising from particular taxes or sources of revenue) set apart and invested, usually at fixed intervals, for the extinguishment of the debt of a government or corporation, by the accumulation of interest. A fund arising from particular taxes, imposts, or duties, which is appropriated towards the payment of the interest due on a public loan and for the gradual payment of the principal. A fund created for extinguishing or paying a funded debt.
- sinking fund debenture
@ sinking fund method of depreciation
The periodic charge is an amount so that when the charges are considered to be an annuity, the value of the annuity at the end of depreciable life is equal to the acquisition cost of the asset. In theory, the charge for a period ought also to include interest on the accumulated depreciation at the start of the period as well. A fund of cash is not necessarily, or even usually, accumulated.

Black's law dictionary. . 1990.

Look at other dictionaries:

  • sinking fund — see fund 1 Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. sinking fund …   Law dictionary

  • Sinking fund — Sinking Sink ing, a. & n. from {Sink}. [1913 Webster] {Sinking fund}. See under {Fund}. {Sinking head} (Founding), a riser from which the mold is fed as the casting shrinks. See {Riser}, n., 4. {Sinking pump}, a pump which can be lowered in a… …   The Collaborative International Dictionary of English

  • Sinking fund — Fund Fund, n. [OF. font, fond, nom. fonz, bottom, ground, F. fond bottom, foundation, fonds fund, fr. L. fundus bottom, ground, foundation, piece of land. See {Found} to establish.] 1. An aggregation or deposit of resources from which supplies… …   The Collaborative International Dictionary of English

  • sinking fund — n. a fund made up of sums of money set aside at intervals, usually invested at interest, in order to meet a specified future obligation, as the retirement of bonds at maturity …   English World dictionary

  • Sinking-fund — (engl., sinkender Fond, Tilgungsfond, Tilgungsstamm), in England das durch die jährliche Zinsersparung anwachsende Vermögen zur Verminderung der Staatsschuld, s.u. Schuldentilgung …   Pierer's Universal-Lexikon

  • Sinking fund — (engl., spr. ßingking fönnd), soviel wie Tilgungsfonds (s. d.) …   Meyers Großes Konversations-Lexikon

  • Sinking fund — (engl., spr. fönnd), s.v.w. Amortisationsfonds (s. Amortisation) …   Kleines Konversations-Lexikon

  • Sinking fund — Sinking fund, engl., Tilgungsfond …   Herders Conversations-Lexikon

  • sinking fund — sinking .fund n technical money saved regularly by a business to pay for something in the future …   Dictionary of contemporary English

  • sinking fund — sinking ,fund noun count money you save in order to pay for something in the future …   Usage of the words and phrases in modern English

  • Sinking fund — Historical ContextA Sinking Fund was a device used in Great Britain in the 18th century to reduce national debt. While used by Robert Walpole in 1716 and effectively in the 1720s and early 1730s, it originated in the commercial tax syndicates of… …   Wikipedia