How Do You Calculate Equipment Rental Rates?
To calculate equipment rental rates, use a short-term equipment rate calculator or other accounting software, such as that available from the Ontario Ministry of Agriculture, Food and Rural Affairs or the Goldenseal Reference Manual. Enter the information into the data fields required in order to determine the rental rate.
Spreadsheet or accounting software can be used to enter the information into a present value formula. A rental contract specifies the payment terms and a monthly payment is calculated by determining the present value of the equipment. The rental rate can be calculated at various rates depending on the circumstances of the rental, such as by the hour, day, week or monthly, according to the Goldenseal Reference Manual. Determine what the equipment is worth when it is purchased new. Then, determine the rate of interest in order to calculate a monthly rate. Divide the monthly rate by four to get a weekly rate or by 30 to get a daily rate.
Equipment lease rate calculators are available online as well as excel spreadsheets that can be downloaded to easily calculate the rental costs. For businesses that rent out equipment, accounting software can be purchased to easily track and enter details in the data fields provided, as explained by the Goldenseal Reference Manual. The software allows you to enter a name, description, the type of rate period as well as a flat amount. Equipment billing software is also available for individuals who want to charge for use of their equipment.
