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Accretion Amount Formula

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Accretion Amount refers to the gradual increase in the value of an asset over time. Check FAQs

AA = ((PB) \cdot (\frac{YTM}{APPY})) - CI

AA - Accretion Amount?PB - Purchase Basis?YTM - Yield to Maturity?APPY - Accrual Period Per Year?CI - Coupon Interest?

Accretion Amount Example

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Here is how the Accretion Amount equation looks like with Values.

Here is how the Accretion Amount equation looks like with Units.

Here is how the Accretion Amount equation looks like.

394500 = ((2000) \cdot (\frac{1200}{6})) - 5500

394500 = ((2000) \cdot (\frac{1200}{6})) - 5500

394500 = ((2000) \cdot (\frac{1200}{6})) - 5500

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Accretion Amount Solution

Follow our step by step solution on how to calculate Accretion Amount?

FIRST Step Consider the formula

AA = ((PB) \cdot (\frac{YTM}{APPY})) - CI

Next Step Substitute values of Variables

∴

AA = ((2000) \cdot (\frac{1200}{6})) - 5500

Next Step Prepare to Evaluate

∴

AA = ((2000) \cdot (\frac{1200}{6})) - 5500

LAST Step Evaluate

∴

AA = 394500

Accretion Amount Formula Elements

Variables

Accretion Amount

Accretion Amount refers to the gradual increase in the value of an asset over time.

Symbol: AA

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Accretion Amount

Purchase Basis

Purchase Basis refers to the method used to determine the cost basis of an asset or investment.

Symbol: PB

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Purchase Basis

Yield to Maturity

Yield to Maturity is a financial term used to describe the total return anticipated on a bond if it is held until it matures.

Symbol: YTM

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Yield to Maturity

Accrual Period Per Year

Accrual Period Per Year refers to the number of times interest is compounded or accrued within a year for a financial instrument such as a bond or loan.

Symbol: APPY

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Accrual Period Per Year

Coupon Interest

Coupon Interest is the fixed annual interest rate paid by the issuer of a bond to the bondholder.

Symbol: CI

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Coupon Interest

Other formulas in Mergers and Acquisitions category

Go Takeover Premium

TPM = PT - VT

Go Gain of Acquirer

GAQ = S - (PT - VT)

Go Post Merger Value of Merged Company

PMV = PVA + VT + S - C

Go Control Premium

CLP = \frac{TPR - MP}{EP}

How to Evaluate Accretion Amount?

Accretion Amount evaluator uses Accretion Amount = ((Purchase Basis)*(Yield to Maturity/Accrual Period Per Year))-Coupon Interest to evaluate the Accretion Amount, Accretion Amount refers to the increase in the value of a financial instrument during a specific period. Accretion Amount is denoted by AA symbol.

How to evaluate Accretion Amount using this online evaluator? To use this online evaluator for Accretion Amount, enter Purchase Basis (PB), Yield to Maturity (YTM), Accrual Period Per Year (APPY) & Coupon Interest (CI) and hit the calculate button.

FAQs on Accretion Amount

What is the formula to find Accretion Amount?

The formula of Accretion Amount is expressed as Accretion Amount = ((Purchase Basis)*(Yield to Maturity/Accrual Period Per Year))-Coupon Interest. Here is an example- 394500 = ((2000)*(1200/6))-5500.

How to calculate Accretion Amount?

With Purchase Basis (PB), Yield to Maturity (YTM), Accrual Period Per Year (APPY) & Coupon Interest (CI) we can find Accretion Amount using the formula - Accretion Amount = ((Purchase Basis)*(Yield to Maturity/Accrual Period Per Year))-Coupon Interest.

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Accretion Amount Formula

Accretion Amount Example

Accretion Amount Solution

Accretion Amount Formula Elements

Other formulas in Mergers and Acquisitions category

How to Evaluate Accretion Amount?

FAQs on Accretion Amount

Variable Name