The Life Starter
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Course Library · Lesson 6 of 6
Money · Guided lesson

Write a capital-purchase brief

About 19 minutes · 4 reading + 15 practice and checks
Time includes reading, practice, and questions. Extra videos or further study are optional.
See this course’s project requirements

An equipment financial decision model with service-equivalent alternatives, timed costs, downtime, residual value and a conditional recommendation.

Keep your working files in your own notebook or software. Save a private description, checklist, and work link in My Proof.

What to include

  • A service-equivalence screen with usable capacity and a changed-demand exclusion.
  • A dated four-column cash-cost ledger with separate resale and maintenance rows.
  • A present-cost table with factors, signed cash flows and final rounding.
  • A contribution-based downtime row linked to service and present cost.
  • A three-scenario sensitivity table with explicit dependent rows.
  • A conditional capital decision brief with calculations and reversal triggers.

Review and revise

Use these criteria to check your work and choose what to improve.

  • Service: every candidate is screened against usable demand.
  • Finance: dated signed costs and present factors reconcile.
  • Risk: downtime/residual scenarios update all dependencies.
  • Decision: conditional grounds, triggers and unresolved real terms are explicit.
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Before you begin

The idea in everyday life

Original fictional practice. All money is USD. No account, payment, personal record or outside participation is required. A fictional print shop needs 900 usable cutting jobs each year for three years. Buy supplies capacity 1,200, costs 2,400 now plus 200 maintenance at each year end and yields 600 resale at year 3. Lease supplies capacity 1,200, costs 100 now plus 900 at each year end, maintenance included, no resale. Repair supplies capacity 1,000, costs 600 now plus 500 at each year end, no resale. Expected lost jobs/year are buy 20, lease 10, repair 80. Each lost job forfeits 2 contribution; use an 8% annual discount rate and year-end operating costs. Ignore financing/taxes; these are exercise assumptions.

The idea

A decision brief exposes the conditions that could reverse the decision.

Follow along

Write a capital-purchase brief — complete worked case

A decision brief exposes the conditions that could reverse the decision.

A fictional print shop needs 900 usable cutting jobs each year for three years. Buy supplies capacity 1,200, costs 2,400 now plus 200 maintenance at each year end and yields 600 resale at year 3. Lease supplies capacity 1,200, costs 100 now plus 900 at each year end, maintenance included, no resale. Repair supplies capacity 1,000, costs 600 now plus 500 at each year end, no resale. Expected lost jobs/year are buy 20, lease 10, repair 80. Each lost job forfeits 2 contribution; use an 8% annual discount rate and year-end operating costs. Ignore financing/taxes; these are exercise assumptions.

Original three-year alternatives

Paste at A1.

AAlternativeBGross jobs/yearCNowDAnnual end costEYear 3 resaleFLost jobs/year
Buy1200240020060020
Lease1200100900010
Repair1000600500080

Copy as plain text
  1. 1. 6.1 Write

    Attach the complete service screen, dated ledger and discounted comparison with a version/date.

    You should see: Recommendation points to reproducible calculations.

  2. 2. 6.2 Write

    Choose proceed, revise or stop for the fictional case and state the assumed service/cost grounds.

    You should see: A supported repair preference is conditional.

  3. 3. 6.3 Write

    Write exact reversal conditions: demand above 920 usable jobs or unsupported downtime assumptions trigger revision.

    You should see: Triggers are measurable, not vague caution.

  4. 4. 6.4 Write

    List unresolved contract, maintenance, financing and actual tax/accounting questions for qualified review; keep the practice unsigned.

    You should see: The completed course produces a decision model, not an equipment purchase.

Now change one thing

A new demand forecast is 950 jobs/year, while the repair option still delivers only 920 usable jobs. Should a repair-only recommendation be revised? Answer yes or no.

Your work

What to finish

A conditional capital decision brief with calculations and reversal triggers.

Common mistake

Watch for this

Calling a scenario result a guarantee or spending money to prove completion.

How can I tell I understand it?

Verify that your completed conditional capital decision brief with calculations and reversal triggers meets the three lesson-specific checks and retains the supporting original records.

Try 3 questions

Quick knowledge check

Answer all 3 questions. Get at least 2 right and the lesson completes automatically.

Not yet passed

You’ll get an explanation for each answer. Signed in? Your results save to your account.

1Which recommendation matches the supplied scope?
2A lease quote lacks an early-termination clause. What belongs in the brief?
3Which output demonstrates course completion?
0 of 3 answeredApply the lesson to a short question, then review the explanation.
6
Finish this lesson

Pass the check. We’ll save the progress.

Answer all 3 questions above and get at least 2 right. You can review the explanations and try again.

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Tools, templates, and lesson sources

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Sources and further reading

Explore the references behind this lesson.

Open Stax: Discounted capital decisions
Source & access notes · checked 2026-10-01

Read discounted cash flow and comparison limits. Course compares present costs for equivalent service, not a promised return.

Access: Public primary page body opened and relevant sections read through the web reader on 2026-10-01; no account required for reading.

Reuse: Original Life Starter cases, datasets and questions; no source exercise or worked dataset reproduced. Links support further reading.

SBA: Manage your business — lease or buy
Source & access notes · checked 2026-10-01

Read the actual redirected public body at lease/buy section: service needs, upfront cash, maintenance and lease-term review. Tax/accounting claims in the source are not adopted as universal rules.

Access: Public primary page body opened and relevant sections read through the web reader on 2026-10-01; no account required for reading.

Reuse: Original Life Starter cases, datasets and questions; no source exercise or worked dataset reproduced. Links support further reading.

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