Quick Answer

Operating cash flow = net income + non-cash charges (depreciation) ± changes in working capital. Free cash flow = operating cash flow − capital expenditures. Positive FCF means your business generates more cash than it spends on maintaining and growing operations.

Cash Flow Calculator

Calculate monthly operating cash flow, free cash flow, and runway from your business financials.
Payroll costs, operating expenses, and CapEx included.

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Understanding business cash flow

Cash flow is the lifeblood of a business. More small businesses fail from cash flow problems than from lack of profitability. Understanding the three components — operating, investing, and financing cash flows — helps you make better decisions about hiring, inventory, and capital investment.

Payroll is typically the largest operating cash outflow for service businesses. The Employer Tax Calculator can help you understand the true cost of each employee including FICA matching, FUTA, and benefits.

For burn rate and runway calculations specifically, use the Burn Rate Calculator. For profit margin analysis, use the Profit Margin Calculator.

Cash FlowMonthly

Enter your financials and click Calculate.

Disclaimer: Results are estimates for planning purposes only. Not financial or accounting advice.

FAQ

Cash Flow Calculator — FAQ

Profit (net income) is an accounting concept that includes non-cash items like depreciation and accruals. Cash flow is actual money moving in and out. A business can be profitable on paper but cash-flow negative if customers pay late (receivables), inventory piles up, or large capital expenditures occur. Conversely, a growing startup may show accounting losses but positive cash flow from customer prepayments.
Free Cash Flow (FCF) = Operating Cash Flow − Capital Expenditures (CapEx). Operating Cash Flow = Net Income + Depreciation/Amortization − Increase in Working Capital. Or using the direct method: FCF = Cash received from customers − Cash paid to suppliers and employees − Taxes paid − CapEx. FCF is considered the most important metric for assessing business health by most investors.
A healthy operating cash flow margin for small businesses is 10–20% of revenue. Free cash flow of 5–15% of revenue is considered good. Startups and growth companies often run negative FCF intentionally as they invest in expansion. The critical metric is cash runway — how many months of operating expenses your current cash covers. A minimum of 6 months is generally considered safe; 12+ is comfortable.
Working capital = current assets (cash + receivables + inventory) − current liabilities (payables + short-term debt). Increases in working capital consume cash; decreases release cash. A growing business typically needs more working capital. If you invoice clients on Net 30 but pay suppliers immediately, you're financing the gap with your own cash. Shortening your collection cycle or extending payment terms improves cash flow without changing profit.

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