The Actuarial Method Lease Calculator allows you to calculate a lease based on distributed payments made on the lease between the amount provided as fund and also to the finance charge in accordance to which a payment is used first to the appended finance charge.
|Fair Value of Asset||$|
|Number of Payments|
|List of Payment||Capital(b/f) ($)||Interest ($)||Payment ($)||Capital(c/f) ($)|
Have you been leasing a property, or are you planning to lease some equipment needed for your business? In the corporate world, leasing equipment is a very effective financial solution to minimize your risk and keep the show going, by leasing from the banks.
The actuarial method for lease calculation helps you calculate your lease with ease. Businesses do buy their properties or machinery when they are required on urgent basis, but that leads to a lower cash flow for the current period. When a lessee leases assets it is a win-win situation. They get to use the required property or infrastructure but don't have to pay all at once, they typically also get a chance to buy the assets at the end of your leasing period.
The actuarial method for lease calculation helps you evaluate your lease finance charges based on the below mentioned values.
"Fair value of asset" refers to the approximate but fair value of the assets a company wants to lease from the bank. This could be a building for company set up, basic infrastructure or some advanced machinery.
The monthly fixed payment amount that you have to pay.
It stands for the interest rate that the bank is charging you for leasing the required asset.
The number of "how many" months or years the payments would be done.
Lease calculations can be tricky if you try to do them manually. On the other hand, by entering the information detailed above in the calculator, you can have a table of content with just one click and see the detailed calculation of your lease finance charges anytime.
Using the actuarial method lease calculator could be really useful, especially for borrowers:
The finance leasing structure process can be defined as follows:
Different bank/finance companies offer different schemes and offers for leasing assets. These offers differ in interest rate brackets, repayment terms and repayment methods as well. We all know the lower the interest rate, the better it is for borrowers but in addition to that there is another thing that can save you some money while leasing the asset.
There are two types of repayment options that are generally offered to the borrowers:
An accounting period is decided between the lesser and lessee for payment, it can be monthly or yearly. When you pay at the end of the accounting period you are charged interest for the particular period and the next cycle begins.
The accounting period decisions will be similar, but the repayment will start with an advance payment of the current accounting period, and this way you save the entire interest amount on the last accounting period. For example, if you are leasing a commercial vehicle for 4 years, you will pay the interest for the first 3 years but will not be charged any interest for the 4th year because you will have paid for the entire accounting period in advance.
The actuarial method lease calculator is a helpful tool to make your leasing decisions in a way that can lead to better financial management, saving money, getting things done without having to buy the expensive assets on the spot thus maintaining a decent cash flow which is a main aspect of running a company's operations smoothly, and finally owning the leased assets if required when the lease period ends.
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