Normally, you would input fields 1-4 and then calculate the payment. Lease Calc Pro allows you to reverse calulcate ANY of the 5 fields simply by providing the other required 4 fields. (You must zero out the field which you wish to calculate. Otherwise, the Base Payment Amount will be calculated by default.)
Calculation Options
Calculation Types
Lease Calc Pro knows how to do two different calculation formulas. These formulas are the most common calculation formulas.
Standard
This is the most common calculation, which may or may not include interest as part of the first payment. Traditionally, this is used when payments are made at the beginning of each payment period. "Standard" and "Standard with Interest" types utilize this calculation. (The difference between the two is that Standard has no interest in payment one of the amortization schedule.)
Standard is a present value of annuity due calculation, and uses the following formula:
((( cap - ( ev / (( 1 + rate )^term ))) * rate ) / ( 1 - (( 1 + rate )^-term ))) / ( 1 + rate )
Where:
* Multiplication
/ Division
^ Raised to the power of
cap Net capitalized cost.
ev End Value (residual)
rate Interest rate per month. If the rate is 7.5, then "rate" would be 7.5 divided by 100, then divided by 12, or .00625
term Number of payments
Sample
Net capitalized cost: 20,000.00
End value (residual/balloon): 11,000,00
Interest Rate: 7.5%
Term: 36 months
Resulting base monthly payment: 346.54
Spreadsheet
This is close to a loan calculation with interest calculated at the end of the payment period. The following formula is used:
( cap - ( ev / (( 1 + rate )^term ))) / (( 1 - ( 1 / (( 1 + rate )^term ))) / rate )
Sample
Total capitalized cost: 20,000.00
End value (residual/balloon): 11,000,00
Interest Rate: 7.5%
Term: 36 months
Resulting base payment: 348.71
Is the first Payment....Capitalized Cost?
If the first payment is to "rolled" (capitalized) into the Net Capitalized Cost, then answer "Yes" to this question. (This allows the customer to skip making the first payment.)
Payment Frequency
The default is monthly, but you may choose from any of the frequencies listed.
Deal Type
This mainly affects the transfer to other applications.
Optional Data
Taxes
Taxes rates are input as percentages. For example, 8.25% is input as 8.25.
Taxes are either accumulative (U.S.) or not (Canada). For example, in Milwaukee, Wisconsin, the 2010 monthly tax rate is 5.6%. The 5.6% is broken down as 5% state tax, 0.5% Milwaukee county tax, and 0.1% stadium tax. The state of Wisconsin requires that these taxes are reported separately in their broken down components. So, you would input 3 tax percentages; 5, 0.5, and 0.1, all with their Accumulative? boxes checked. This way, the sum of all three will always equal 5.6%.
An example of non-accumulative taxes can be found in Canada. Ontario, for example, has a Provincial Sales Tax of 8%. The Goods and Services tax in Canada is 5%. Each tax is calculated separately, rather than added together as 13%. In this case you would input two tax percentages of 8 and 5, each with their Accumulative? boxes unchecked.
If you are using GST and PST, then you should take advantage of the GST/PST? speed buttons provided. Simply press the G button for a 5% GST, and the P button for an 8% PST. (You will be able to change the rates.) You must use the G button if your lease has a trade-in with a lien, otherwise the monthly tax calculation will be incorrect.
(Note: If you are using HST in Canada, please still mark it as GST.)
Taxable Add-On to Base Payment
Sometimes you have a "monthly reserve," "expense reserve," or other taxable amount that is added onto each payment. Input that amount here.
Amount of Net Capitalized Cost that is Non-taxable
If the Net Capitalized Cost contains an amount that is not to be taxed, enter that here.
Calculated Results
After pressing the Calculate
button, your lease calculation results will be displayed here.Total Base Payment is the Base Payment plus Taxable Add-On to Base Payment.
Taxable Base Payment is the deal recalculated to exclude the Amount of Net Capitalized Cost that is Non-taxable.
Sales/Use Tax Percent is the sum of all of the Taxes (%).
Sales/Use Tax Amount is the total monthly tax amount.
Total Monthly Payment is the Total Base Payment plus the Sales/Use Tax Amount.
There are two other places where calculation results are displayed. One is in the Resulting Amount column in the Optional Data box. The other is on the Amortization page.