Lease versus Purchase Decision Cost of Purchasing


W	9	WORKSHEET	Worksheet for the Lease versus Purchase Decision

				Cost of Purchasing

		a.	Agreed-upon purchase price
		b.	Down payment
		c.	Total loan payments (monthly loan payment x ___ no. months)
		d.	Opportunity cost of down payment [line b x
				(1 + foregone rate of return ^{(number of years)})]
		e.	Less: Expected market value of the car ar the end of the loan
		f.	Total cost of purchasing		$0

				Cost of Leasing

		g.	Down payment (capitalized cost reduction) + security deposit
		h.	Total lease payments (monthly lease payment x ___ no. months)
		i.	Opportunity cost of total initial payment [line g x
				(1 + foregone rate of return^{(number of years)})]
		j.	Any end-of-lease charges (e.g., excess mileage), if applicable
		k.	Less: Refund of security deposit
		l.	Total cost of leasing		$0

						$0