Business decision tool
Lease versus Buy Equipment Calculator
Compare the present cost of annual lease payments with buying and later reselling equipment.
Inputs and results stay in this browser. Currency symbols are illustrative; use any consistent currency.
Understand Lease vs buy
One idea, three depths
Choose how deeply to explain Lease vs buy
Lease vs buy: Compare the present cost of annual lease payments with buying and later reselling equipment.
Age 5Explain it to a 5-year-oldStart with a picture
Imagine using Lease vs buy to answer this question: compare the present cost of annual lease payments with buying and later reselling equipment? Enter Annual lease payment, Cash purchase price, Expected resale value, and 2 other inputs; the calculator shows Present cost of leasing. Try changing one number and watch what happens to Present cost of leasing. The answer tells you Present cost of leasing.
Age 15Explain it to a 15-year-oldConnect it to the formula
This pre-tax comparison assumes annual end-of-period lease payments. Maintenance, tax deductions, financing structure and usage restrictions require separate treatment. The rule is PV lease = annuity PV; PV buy = purchase price − discounted salvage value. Its input values are Annual lease payment, Cash purchase price, Expected resale value, Annual discount rate (%), Analysis years, and the main result is Present cost of leasing. Try changing one number and watch what happens to Present cost of leasing.
CollegeExplain it at college levelState the model precisely
This tool models one operating decision from explicitly supplied company assumptions. The implemented relation is PV lease = annuity PV; PV buy = purchase price − discounted salvage value, evaluated from Annual lease payment, Cash purchase price, Expected resale value, Annual discount rate (%), Analysis years to produce Present cost of leasing. This pre-tax comparison assumes annual end-of-period lease payments. Maintenance, tax deductions, financing structure and usage restrictions require separate treatment. The model omits unentered taxes, cash timing, legal constraints and market uncertainty. Compare the output with company records and a downside scenario before committing resources.
The decision this tool supports
Compare the present cost of annual lease payments with buying and later reselling equipment.
Why the business model works
This pre-tax comparison assumes annual end-of-period lease payments. Maintenance, tax deductions, financing structure and usage restrictions require separate treatment.
Inputs and operating assumptions
This model uses Annual lease payment (at least 0), Cash purchase price (at least 0), Expected resale value (at least 0), Annual discount rate (at least 0), Analysis years (at least 1). Keep currencies, accounting treatment and time periods consistent with one another.
The formula
PV lease = annuity PV; PV buy = purchase price − discounted salvage value
What the calculator produces
The primary output is Present cost of leasing; it also exposes Present cost of buying, Lease minus buy present cost. Change one assumption at a time so the comparison remains explainable.
Before using the result in a decision
This compact model cannot capture every tax, accounting, legal, market or operational condition. Compare the output with current company records, cash timing and the downside scenario before committing resources.
Supporting sourcesAcademic referencesPrimary standards, textbooks and complete citations
Standards, reading and academic references
Use the calculator as the worked interaction, then consult the primary standards and academic textbooks listed below. MW SysArc links to the original sources; the explanation on this page is original and does not reproduce them.
Introduction to Business 2e
Read the free OpenStax business textbookCite this book
- APA 7
- Gitman, L. J., McDaniel, C., Shah, A., Reece, M., Koffel, L., Talsma, B., & Hyatt, J. C. (2026). Introduction to business 2e. OpenStax. https://openstax.org/books/introduction-business-2e/pages/1-introduction
- MLA 9
- Gitman, Lawrence J., et al. Introduction to Business 2e. OpenStax, 2026, https://openstax.org/books/introduction-business-2e/pages/1-introduction.
- Chicago author-date
- Gitman, Lawrence J., Carl McDaniel, Amit Shah, Monique Reece, Linda Koffel, Bethann Talsma, and James C. Hyatt. 2026. Introduction to Business 2e. Houston, TX: OpenStax. https://openstax.org/books/introduction-business-2e/pages/1-introduction.
OpenStax entries are free to read online. Follow the licence shown on each linked source before redistributing or adapting its content.
Reuse the page responsiblyCite this pageAPA, MLA, Chicago, Harvard, BibTeX and RIS
These formats cite this calculator page itself. They are separate from the academic references above, which support the mathematical method and terminology.
APA 7
MW SysArc. (2026, July 21). Lease versus Buy Equipment Calculator. MW SysArc Tools. https://business.mwsysarc.com/lease-versus-buy-equipment
MLA 9
MW SysArc. “Lease versus Buy Equipment Calculator.” MW SysArc Tools, 21 July 2026, https://business.mwsysarc.com/lease-versus-buy-equipment. Accessed 31 Aug. 2026.
Chicago 17
MW SysArc. “Lease versus Buy Equipment Calculator.” MW SysArc Tools. Published July 21, 2026. Accessed August 31, 2026. https://business.mwsysarc.com/lease-versus-buy-equipment.
Harvard
MW SysArc (2026) ‘Lease versus Buy Equipment Calculator’, MW SysArc Tools. Published 21 July 2026. Available at: https://business.mwsysarc.com/lease-versus-buy-equipment (Accessed: 31 August 2026).
BibTeX and RIS records
BibTeX
@misc{mwsysarc_lease_versus_buy_business_2026,
author = {{MW SysArc}},
title = {Lease versus Buy Equipment Calculator},
howpublished = {MW SysArc Tools},
year = {2026},
url = {https://business.mwsysarc.com/lease-versus-buy-equipment},
note = {Published July 21, 2026; accessed August 31, 2026}
}RIS
TY - ELEC
AU - MW SysArc
TI - Lease versus Buy Equipment Calculator
T2 - MW SysArc Tools
PY - 2026
DA - 2026-07-21
Y2 - 2026-08-31
UR - https://business.mwsysarc.com/lease-versus-buy-equipment
N1 - Published July 21, 2026
ER -Clear answers
Frequently asked questions
What does the Lease vs buy do?
Compare the present cost of annual lease payments with buying and later reselling equipment.
How does the Lease vs buy work?
The calculator applies PV lease = annuity PV; PV buy = purchase price − discounted salvage value. This pre-tax comparison assumes annual end-of-period lease payments. Maintenance, tax deductions, financing structure and usage restrictions require separate treatment.
What can I learn from the Lease vs buy?
It connects company inputs to a transparent business result. Change one value at a time to compare operating scenarios.
Does MW SysArc receive or store what I enter?
No. The calculation runs locally in your browser. MW SysArc does not receive or store your calculation inputs.
How should I use the result?
Use the result as a practical reference. Review the inputs, assumptions and stated limitations before relying on it.
Last reviewed . Calculations tested .