Calculate Equipment Lease Monthly Cost
I need to figure out the monthly payment for a $15,000 piece of machinery leased over 3 years at 5% interest.
=-PMT(B3/12, B4*12, B2) How it works: The PMT function calculates the payment for a loan or lease based on constant payments and a constant interest rate. In this formula: - `B3/12` represents the monthly interest rate (annual rate divided by 12 months). - `B4*12` represents the total number of payments (lease term in years multiplied by 12 months/year). - `B2` is the present value, which is the initial amount of the lease ($15,000). The negative sign before PMT is used to display the payment as a positive outgoing cost, which is typical for budgeting.
Data Setup
| Description | Value |
|---|---|
| Present Value (PV) | $15000 |
| Annual Interest Rate | 0.05 |
| Lease Term (Years) | 3 |
| Monthly Payment |
Step-by-Step Guide
Input the lease's present value ($15,000) into cell B2.
Enter the annual interest rate (5% or 0.05) into cell B3.
Input the lease term in years (3) into cell B4.
In a separate cell (e.g., B6), enter the PMT function: `=-PMT(B3/12, B4*12, B2)`.
Press Enter to see the calculated monthly payment.
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