If the payments are made annually, the next step is straightforward. Use the =IRR () function in your spreadsheet to calculate the interest rate of the capital lease.

Learn what IRR is, how it's calculated, its uses in investment analysis, and factors to consider when interpreting it.

Q. I have prepared projections for a proposed project, and I want to calculate the internal rate of return. Instead of using Excel’s IRR function, should I use simple math formulas so others can ...