This equipment calculator gives the monthly payment, total interest and total cost including down payment for a price, down payment, rate and term. The page then shows how to work out payback period in months and simple ROI by hand. Oceangate Funding Group, a small-business funding broker in Ogden, Utah, offers it as illustrative arithmetic, not an offer or quote.
Using the calculator
- Equipment price: the quoted price, including installation if it is being financed.
- Down payment: any amount you pay up front; leave blank if none.
- Interest rate: the annual rate from an offer you hold, or one you want to test.
- Term: the offer's length, counted in monthly payments.
The results are the monthly payment, the total interest over the term, and the total cost of the equipment including the down payment.
Step 2: Estimate the monthly benefit
The calculator cannot know what the equipment earns or saves. Estimate it yourself, in dollars per month:
- Extra revenue: more jobs, more covers, more patients the equipment makes possible.
- Savings: rental fees no longer paid, subcontracting brought in-house, labor hours saved.
- Minus new running costs: fuel, maintenance, insurance and operator time.
Be conservative. Equipment rarely runs at full use from the first month.
Step 3: Work out the payback period
Simple payback period (months) = total cost including down payment ÷ monthly net benefit.
Use the calculator's total cost figure so that interest is included. Compare the result with the equipment's useful life: if a machine takes longer to pay back than it will last, it does not pay for itself.
A second check matters as much: compare the monthly payment with the monthly benefit. If the benefit exceeds the payment, the machine adds cash each month from the start; if not, the business covers the difference from elsewhere until the loan ends.
Step 4: Work out simple ROI
Simple ROI = (monthly net benefit × months of useful life − total cost) ÷ total cost.
This ignores the timing of money and resale value, so treat it as a first screen, not a full analysis. If the equipment will have resale value at the end of its life, add that to the benefit side.
Testing the method at zero interest
Hypothetical figures only, chosen to show the method: a $24,000 machine, $4,000 down, zero interest and 40 monthly payments. The calculator gives a $500 monthly payment and a $24,000 total cost. If the machine saves $800 a month net of running costs, simple payback is 24,000 ÷ 800 = 30 months, and the machine adds $300 a month in cash while financed. Over a 60-month useful life, ROI is (800 × 60 − 24,000) ÷ 24,000 = 1.0, or 100 percent. With interest, the total cost rises and payback lengthens. None of these figures is an offer.
Why your figures may differ from an offer
- Fees financed into the amount, or deducted from it, change the true cost.
- Leases may have end-of-term purchase amounts not captured here.
- Some partners calculate interest daily or use a different first payment date.
- Tax effects of buying or leasing are not included; ask your accountant.
Illustrative arithmetic only; actual rates and terms come from lending partners.
Next steps
If the machine pays back well within its life, compare structures in equipment financing, or a term loan if the equipment is part of a bigger project. Other tools and guides sit in the resources section.
By Oceangate Funding Group · Updated