The internal rate of return, or IRR, allows investors to analyze the profitability of investments and companies to analyze the profitability of capital outlays.

Investors can use the internal rate of return (IRR) to calculate the potential return on investments. Rachel Mendelson/Insider ...

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.