Cash Flow Calculator

What Is Cash Flow?

Cash flow is the movement of money into and out of a business during a specific period. Cash received from customers, financing, investments, and other sources creates cash inflows. Payments for payroll, inventory, rent, taxes, debt, equipment, and other costs create cash outflows.

The basic calculation is:

A positive result means the business received more cash than it paid out during the selected period. A negative result means more cash left the business than came in.

How to Calculate Cash Flow

To calculate cash flow, add all cash received during the period and subtract all cash payments made during the same period.

1. Add sales receipts and other cash inflows.
2. Add operating and other cash payments.
3. Subtract total cash outflows from total cash inflows.
4. Add the result to your opening cash balance.

For example, if a business receives $50,000 and pays $42,000 during a month, its net monthly cash flow is:

Monthly Cash Flow Calculator

A monthly cash flow calculator helps you see how much cash your business generates or uses during one month. Monthly figures are useful for managing payroll, supplier payments, rent, taxes, loan payments, inventory, and other regular obligations.

Enter your expected cash receipts and payments for one month, then select Monthly in the calculator above. The result shows your net monthly cash flow and estimated ending cash balance.

Annual Cash Flow Calculator

An annual cash flow calculator measures cash received and cash paid over a full year. It can be useful when reviewing yearly business performance or planning major purchases and financing.

Select Annual in the calculator and enter annual figures for your inflows and outflows.

If your monthly cash flow is consistent, annual net cash flow can also be estimated with:

This shortcut does not account for seasonal changes or irregular payments, so a month-by-month forecast can provide a more useful picture when cash flow changes throughout the year.

Net Cash Flow Calculator

A net cash flow calculator focuses on the difference between total cash coming into a business and total cash going out.

What Is Monthly Cash Flow?

Monthly cash flow is the amount of cash left after subtracting monthly cash outflows from monthly cash inflows.

For example:

• Monthly cash inflows: $35,000
• Monthly cash outflows: $29,000
• Net monthly cash flow: $6,000

If the result remains positive over several months, the business is generating cash from its current pattern of receipts and payments. A negative result means the business is using more cash than it receives during that period.

Cash Flow vs Profit

Cash flow and profit are related, but they are not the same financial measure.

A business can report a profit while experiencing negative cash flow. For example, a company may make a large sale on credit but not receive the customer's payment for several weeks. Meanwhile, payroll and supplier bills may still need to be paid.

Cash Flow Statement

A formal cash flow statement provides a more detailed view of cash movements. It generally groups cash activity into operating, investing, and financing activities.

• Operating activities: Cash related to normal business operations.
• Investing activities: Cash associated with investments and purchases or sales of long-term assets.
• Financing activities: Cash related to borrowing, repaying debt, or raising capital.

The calculator above is designed for quick planning rather than replacing a complete financial statement.

Cash Flow From Assets

Cash flow from assets is a corporate-finance concept that is different from a simple monthly business cash flow calculation.

It generally considers cash generated by a firm's operating assets after accounting for investment in fixed assets, with financing flows considered separately.

If you are evaluating the present value of future cash flows, you need a different type of financial model that includes a discount rate and timing of future payments.

After-Tax Cash Flow

Taxes can have a direct effect on the cash available to a business. This calculator therefore includes taxes as a separate cash outflow.

For a simple estimate:

More detailed after-tax cash flow calculations can involve depreciation, tax deductions, capital expenditures, deferred taxes, and the structure of the business. For tax reporting or tax planning, use figures appropriate to your specific tax situation.

Cash Flow to Creditors

Cash flow to creditors is a separate corporate-finance measure. It focuses on cash paid to lenders, including interest and changes in debt.

The calculator includes both interest payments and loan principal because both can reduce the cash available to a business.

However, these inputs should not be interpreted as a complete cash flow to creditors calculation for financial analysis.

Cash Flow Forecasting

Cash flow forecasting estimates how your cash balance may change over future periods. The 12-month projection in this calculator uses your current monthly inflows and outflows as a simple baseline.

For example, if your opening cash is $20,000 and your business generates $5,000 in net cash flow each month, the simplified projection would be:

Real cash flow can vary because of seasonality, delayed customer payments, large inventory purchases, taxes, equipment purchases, annual bills, and other irregular transactions.

Cash Flow Margin

Cash flow margin compares net cash flow with total cash inflows.

For example, if a business receives $50,000 and generates $7,500 in net cash flow:

A cash flow margin should be interpreted in the context of the business model, industry, growth stage, debt obligations, and timing of payments.

Cash Burn and Runway

Businesses with negative cash flow can use cash runway as a simple way to estimate how long their current cash reserves could last.

For example, if a company has $60,000 available and is losing $10,000 per month:

This is only a simple estimate. A real runway calculation should account for expected changes in revenue, expenses, fundraising, debt, and one-time payments.

How to Improve Business Cash Flow

If your result shows negative cash flow, focus first on the largest sources of cash pressure.

1. Collect customer payments faster. Shorter payment terms, deposits, timely invoices, and payment reminders can reduce delays.
2. Review major recurring expenses. Payroll, rent, inventory, financing, and large subscriptions can have a significant effect on cash.
3. Manage inventory carefully. Excess inventory can tie up cash that could otherwise remain available for operations.
4. Plan for taxes and large payments. Setting aside cash for predictable bills can reduce sudden cash shortages.
5. Maintain a cash reserve. A reserve can help cover temporary gaps between customer receipts and business payments.
6. Review cash flow regularly. Comparing monthly results can show whether your cash position is improving or getting weaker.

How to Use This Cash Flow Calculator

1. Select Monthly or Annual.
2. Select your preferred currency.
3. Enter your opening cash balance.
4. Add expected cash inflows.
5. Add your cash outflows.
6. Click Calculate Cash Flow.
7. Review net cash flow, ending cash, margin, runway, and the 12-month projection.

For the most useful result, use actual or realistic expected cash movements rather than accounting revenue that has not yet been collected.