Act on the result
Confirm all cash flows and compare the lower-cost option with operational flexibility needs.
Educational only: Business decision support, not accounting, tax or legal advice.
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Update policy: Reviewed when formulas or official dependencies change.
Scope: Market-neutral small-business planning using your own assumptions.
What this planner helps you decide
Best for
Businesses comparing equipment lease and purchase cash flows on one period basis.
Outputs
Present value of each option, their difference and the lower-cost option under entered assumptions.
Start here
Include upfront and periodic cash flows plus a cautious residual value for the buy option.
Use a different tool when: Do not use this to compare user-entered hire and ownership economics at expected utilisation; use Rent vs Own Equipment Comparison for that decision. Use this tool to compare cash timing and total user-entered cost of leasing and buying equipment.
Cash & growth
Lease vs Buy Equipment: present value of each option
Present value of each option, their difference and the lower-cost option under entered assumptions.
Amounts use the same currency as your inputs. No currency conversion is performed.
Explicit dated lease and buy cash flows
PDF and CSV exports stay on this device. Clean page links contain no inputs.
Enter each option's actual timing. Nominal totals remain separate from the optional present-value view.
- Dated nominal lease minus buy
- 3,500.00
- Lease nominal cost
- 38,500.00
- Buy nominal cost
- 35,000.00
- Lease present-value cost
- Not available
- Buy present-value cost
- Not available
- Nominal lease minus buy
- 3,500.00
- Present-value lease minus buy
- Not available
- Lease peak cash use
- 38,500.00
- Buy peak cash use
- 40,000.00
- Lower nominal cost option
- buy
- Lower present-value cost option
- Not available
The chart and fallback table preserve every dated cash-flow event.
Lease cash usedBuy cash used
| Dated event | Lease cash used | Buy cash used |
|---|---|---|
| 2026-01-01 | 2,000.00 | 10,000.00 |
| 2027-01-01 | 2,000.00 | 40,000.00 |
| 2028-12-31 | 38,500.00 | 35,000.00 |
| 2026-01-01 | Lease 2,000.00 | Buy 10,000.00 |
|---|---|---|
| 2027-01-01 | Lease 2,000.00 | Buy 40,000.00 |
| 2028-12-31 | Lease 38,500.00 | Buy 35,000.00 |
Scenario comparison
Save an immutable baseline, then edit the collection to see the exact result change.
Calculation details
View calculation detailsView the formulas and inputs used for these results.
Lease nominal cost
Lease nominal cost
sum lease cash flows + terminal adjustment38,500Result38,500.00
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Lease nominal costLease Cash Flow Count
- 2
- Lease nominal costBuy Cash Flow Count
- 3
Buy nominal cost
Buy nominal cost
sum buy cash flows + terminal adjustment35,000Result35,000.00
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Buy nominal costLease Cash Flow Count
- 2
- Buy nominal costBuy Cash Flow Count
- 3
Lease present-value cost
Lease present-value cost
discount each lease cash flow and terminal adjustmentResultNot available
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Lease present-value costLease Cash Flow Count
- 2
- Lease present-value costBuy Cash Flow Count
- 3
Buy present-value cost
Buy present-value cost
discount each buy cash flow and terminal adjustmentResultNot available
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Buy present-value costLease Cash Flow Count
- 2
- Buy present-value costBuy Cash Flow Count
- 3
Nominal lease minus buy
Nominal lease minus buy
lease nominal cost − buy nominal cost3,500Result3,500.00
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Nominal lease minus buyLease Cash Flow Count
- 2
- Nominal lease minus buyBuy Cash Flow Count
- 3
Present-value lease minus buy
Present-value lease minus buy
lease present-value cost − buy present-value costResultNot available
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Present-value lease minus buyLease Cash Flow Count
- 2
- Present-value lease minus buyBuy Cash Flow Count
- 3
Lease peak cash use
Lease peak cash use
maximum cumulative lease cash use38,500Result38,500.00
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Lease peak cash useLease Cash Flow Count
- 2
- Lease peak cash useBuy Cash Flow Count
- 3
Buy peak cash use
Buy peak cash use
maximum cumulative buy cash use40,000Result40,000.00
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Buy peak cash useLease Cash Flow Count
- 2
- Buy peak cash useBuy Cash Flow Count
- 3
Lower nominal cost option
Lower nominal cost option
decision from the sign of nominal lease minus buybuyResultbuy
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Lower nominal cost optionLease Cash Flow Count
- 2
- Lower nominal cost optionBuy Cash Flow Count
- 3
Lower present-value cost option
Lower present-value cost option
decision from the sign of present-value lease minus buy when availableResultNot available
Uses every explicit dated lease and buy cash flow. Raw precision retained.
Dated cash-flow formulas →Inputs used by these formula steps
- Lower present-value cost optionLease Cash Flow Count
- 2
- Lower present-value cost optionBuy Cash Flow Count
- 3
Inputs used
- Discounting enabled
- No
Open this calculator with preset values
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| Parameter | Meaning | Unit | Allowed values | Presence | Default |
|---|---|---|---|---|---|
| annualDiscountRate | Optional user-entered annual rate for the separate PV view. | decimal effective annual discount rate for dated cash flows (1 = 100%) | 0 to 1 | Required | 0 |
| leaseEndCost | Explicit lease return or disposal cash cost. Use one consistent currency and time basis. | currency units of lease disposal cost at comparison end | 0 to 100000000 | Required | 500 |
| leasePeriodicPayment | Total dated lease payments after the upfront amount. Use one consistent currency and time basis. | currency units in aggregate dated lease payments | 0 to 100000000 | Required | 36000 |
| leaseUpfrontCost | Cash paid at the start of the lease option. Use one consistent currency and time basis. | currency units at comparison start | 0 to 100000000 | Required | 2000 |
| purchaseMaintenanceCost | Explicit maintenance cash outflows. Use one consistent currency and time basis. | currency units of buy-option maintenance over the comparison horizon | 0 to 100000000 | Required | 3000 |
| purchasePeriodicCost | Total dated purchase-option payments after the upfront amount. Use one consistent currency and time basis. | currency units in aggregate dated buy payments | 0 to 100000000 | Required | 30000 |
| purchaseResidualValue | User-entered value remaining at the end of the comparison. Use one consistent currency and time basis. | currency units of buy-option residual value at comparison end | 0 to 100000000 | Required | 8000 |
| purchaseUpfrontCost | Cash paid at the start of the buy option. Use one consistent currency and time basis. | currency units at comparison start | 0 to 100000000 | Required | 10000 |
Lease vs Buy Equipment: present value of each option
Present value makes cash timing comparable but remains sensitive to the entered residual value.
Formula summary
- Primary formula
- lease nominal cost − buy nominal cost
Data used here
- The estimate uses your inputs and the general business formula documented in the methodology.
Decision checks
Stress-test the decision
Retest with a lower residual value and higher discount rate before choosing an option.
When this estimate can be misleading
- This model excludes lender fees, tax effects, covenant wording and lender-specific assessments.
- Results depend on complete, consistently classified inputs.
- Demand, timing, quality and strategic fit remain separate decisions.
- This is educational business decision support, not accounting, tax, legal or financial advice.
- Present value makes cash timing comparable but remains sensitive to the entered residual value.
Educational estimate, not advice. See all assumptions & limitations →
Related reading
Guides to interpret the decision and its assumptions.
- Business Cash-Flow Review: Dates, Gaps and Next Decisions
Build a dated cash view, locate the first shortfall and test collections, payment, inventory and financing timing one scenario at a time.
Read guide
Frequently asked questions
How do I compare cash timing and total user-entered cost of leasing and buying equipment?
Confirm all cash flows and compare the lower-cost option with operational flexibility needs.
Which planning assumptions should I stress-test?
Compare a plausible alternative scenario and verify the decision-critical assumption that changes the plan most.