Cash Flow Calculator
Compute operating cash flow, free cash flow, margins, burn rate, and runway from your revenue and expenses
Calculator Settings
Direct costs: materials, manufacturing, freight
Rent, salaries, utilities, marketing, insurance
Non-cash charge added back to compute cash flow
Equipment, property, long-term asset purchases
Enter to calculate cash runway if burning cash
Calculation Results
Please fill in revenue, COGS, and operating expenses to see cash flow results
Complete Guide to Cash Flow Analysis
What Is Cash Flow?
Cash flow tracks the real movement of money into and out of a business during a specific period. Unlike accrual-based profit, which recognises revenue when earned and expenses when incurred, cash flow reflects when money actually changes hands. A company can report strong profits while running out of cash if customers pay slowly or capital investments are large.
The three pillars of cash flow analysis are operating cash flow (day-to-day business), investing cash flow (asset purchases), and financing cash flow (debt and equity). This calculator focuses on the first two — operating and free cash flow — which together reveal whether a business generates enough cash to sustain itself. For a complementary view of accounting profitability, see the Profit Margin Calculator.
Cash Flow Formulas
Operating & Free Cash Flow:
Gross Profit = Revenue − COGS
OCF = Revenue − COGS − OpEx + Depreciation
FCF = OCF − Capital Expenditures
Cash Flow Margin = OCF ÷ Revenue × 100%
Burn Rate = |FCF| (when FCF < 0)
Runway = Cash Balance ÷ Monthly Burn Rate
Where: COGS = cost of goods sold, OpEx = operating expenses (rent, payroll, utilities), Depreciation = non-cash charge added back, CapEx = capital expenditure on long-term assets.
Why Cash Flow Analysis Matters
Solvency Check
Profitable companies go bankrupt when they cannot meet payroll, rent, or debt payments. Cash flow analysis catches liquidity problems before they become crises.
Investment Decisions
FCF shows how much cash is available for growth, dividends, or debt reduction after maintaining operations. Use it alongside an NPV Calculator to evaluate project viability.
Startup Runway
Pre-revenue and early-stage companies live on cash runway. Knowing your monthly burn rate tells you exactly when you need the next funding round or must reach profitability.
Valuation Input
Discounted cash flow (DCF) models — the gold standard for company valuation — use projected FCF as the core input. Accurate cash flow data drives accurate valuations.
Tips for Accurate Cash Flow Analysis
Separate recurring from one-time items: A large equipment purchase inflates CapEx for one period but is not a recurring burn. Normalise one-off items so you do not overstate or understate the trend. Check your Break-Even Calculator results after excluding one-time costs.
Track monthly trends: A single period snapshot can mislead. Run cash flow monthly for at least 6 months to spot seasonal patterns, deteriorating margins, or growing burn.
Do not confuse profit with cash: Accrual accounting books revenue on invoicing, not collection. If you have $200K in accounts receivable, that revenue is booked but not yet cash. Always reconcile with your IRR Calculator when evaluating project-level returns.
Common Mistakes
Forgetting to Add Back Depreciation
Depreciation reduces accounting profit but does not consume cash. Failing to add it back understates operating cash flow — sometimes by 20–40% in asset-heavy businesses like manufacturing or real estate.
Ignoring Working Capital Changes
Growing inventory or slow-paying customers tie up cash even as sales grow. A company doubling revenue while doubling receivables may see zero improvement in actual cash. This simplified calculator assumes stable working capital — adjust if your receivables or payables are changing significantly.
Using Annual Figures for Monthly Burn Rate
Revenue and expenses are rarely uniform across months. Using an annual average masks months where burn spikes (e.g. annual insurance premiums, quarterly tax payments). Build cash flow monthly for actionable runway estimates.
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OpenFrequently Asked Questions
What is cash flow and why does it matter?
Cash flow measures the actual money moving in and out of a business over a period. A company can be profitable on paper (accrual accounting) yet run out of cash because revenue is booked before it is collected. Monitoring cash flow prevents insolvency even when the income statement looks healthy.
How is operating cash flow calculated?
Operating Cash Flow = Revenue − COGS − Operating Expenses + Depreciation & Amortization. Depreciation is a non-cash charge already deducted in the P&L, so it is added back to reflect actual cash generated from operations. This calculator uses the direct method for clarity.
What is free cash flow and how does it differ from operating cash flow?
Free Cash Flow (FCF) = Operating Cash Flow − Capital Expenditures. OCF shows cash from day-to-day operations; FCF shows what remains after reinvesting in long-term assets like equipment or software. FCF is the cash available for dividends, debt repayment, or growth — investors watch it closely.
How does this compare to the Profit Margin Calculator?
The Profit Margin Calculator focuses on accounting profitability — gross, operating, and net margins based on accrual figures. This Cash Flow Calculator focuses on actual cash movement, adding back non-cash charges like depreciation and subtracting capital expenditures. A business can have strong margins but negative cash flow if it has heavy CapEx or slow receivables.
What is burn rate and cash runway?
Burn rate is the monthly net cash a company spends when it operates at a loss (negative FCF). Cash runway = Current Cash Balance ÷ Monthly Burn Rate, giving the number of months before cash runs out. Startups typically target 12–18 months of runway between funding rounds.
Can you show a worked example?
Monthly figures: Revenue = $100,000, COGS = $40,000, OpEx = $35,000, Depreciation = $5,000, CapEx = $10,000. Gross Profit = $60,000. OCF = 100K − 40K − 35K + 5K = $30,000. FCF = 30K − 10K = $20,000. Cash flow margin = 30%. If cash balance is $250K and FCF were negative at −$10K/mo, runway would be 25 months.