How to Calculate a Lease on Camera Equipment

Leasing camera equipment differs slightly from a rental agreement, sometimes making a lease the better business option. Most camera rentals offer the use of equipment over a fixed time for a price. At the end of the rental agreement, the user returns the gear. A lease is typically a long-term contract with the option of buying the equipment at the end. Calculating a lease on camera equipment requires full understanding of the contract terms.

Instructions

1

Review the lease terms and monthly payments. The basic cost of a lease will be the amount of the monthly payment multiplied by the number of months in the contract. For example, a camera lens might lease for $25 per month for a 24-month term, which would cost $600.

2

Add any fees or surcharges listed in the contract. Examples include an origination fee, which is basically a payment to the person or company that prepares the contract, and buy-out terms, which outline the cost of purchasing the leased equipment at the end of the contract.

3

Compare the fair market value of buying the camera equipment outright, versus the full cost of the lease, which will almost always be greater.

4

Estimate the benefit of leasing the equipment without the up-front capital cost of buying the equipment. For example, a camera used in a photography studio generates revenue for the photographer. That revenue generates cash flow that may be greater and more immediately useful to the photography business if acquired in a lease, than if the full cash price was paid up front to buy the equipment instead of using that money for other business expenses, such as leasing studio space.