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Cash Flow Calculator: Find Net Cash Flow and Operating Cash Flow
Add up the cash your business brought in and paid out across operating, investing and financing activities. The calculator gives you operating cash flow, net cash flow, ending cash and free cash flow for any period.
- Operating cash flow by the direct or indirect method
- Net cash flow, ending cash and free cash flow in one view
- Runs in your browser; nothing is uploaded or stored
Net Cash Flow Calculator
Fill in each tab with the cash that came in and went out. The example is one month of a small business.
Cash actually received and paid. Easiest if you work from bank statements.
Operating cash flow
+7,500.00
How to Find Net Cash Flow
Net cash flow is the change in a business's cash over a period. It tells you whether more money came in than went out, and by how much.
Quick answer: Find the cash flow from operating, investing and financing activities, then add them together. A positive result means cash grew during the period; a negative result means it shrank.
Net Cash Flow Formula
Net cash flow = operating cash flow + investing cash flow + financing cash flow
Each of the three figures is its own inflows minus its outflows, so any of them can be negative. You can check the answer with the balance method:
Net cash flow = cash at end of period − cash at beginning of period
If the two methods disagree, a transaction is missing or sits in the wrong section.
Net Cash Flow Example
The example loaded in the calculator is one month for a small business that starts with 25,000.00 in the bank.
| Activity | Inflows | Outflows | Cash flow |
|---|---|---|---|
| Operating | 49,000.00 | 41,500.00 | +7,500.00 |
| Investing | 2,000.00 | 9,500.00 | −7,500.00 |
| Financing | 10,000.00 | 5,400.00 | +4,600.00 |
| Net cash flow | +4,600.00 |
Cash rises from 25,000.00 to 29,600.00. The business generated cash from operations, spent all of it on new equipment, and the new loan is what actually increased the balance.
How to Find Operating Cash Flow
Operating cash flow (OCF), also called cash flow from operations, is the cash the day-to-day business generates: selling, buying stock, paying staff, rent and tax. It is the most important of the three numbers because it shows whether the business funds itself.
There are two ways to calculate it. They use different inputs but give the same result.
Operating Cash Flow Formula: Direct Method
Operating cash flow = cash received from customers + other operating receipts − cash paid to suppliers, employees and for operating expenses − interest paid − income taxes paid
The direct method is the natural choice for small businesses and anyone working from bank statements, because every number is a real deposit or payment.
Direct Method Example
| Line | Amount |
|---|---|
| Cash received from customers | 48,500.00 |
| Other operating receipts | 500.00 |
| Paid to suppliers and for inventory | −18,200.00 |
| Payroll and wages | −14,600.00 |
| Rent, insurance, advertising and other costs | −6,250.00 |
| Interest paid | −350.00 |
| Income taxes paid | −2,100.00 |
| Operating cash flow | 7,500.00 |
Operating Cash Flow Formula: Indirect Method
Operating cash flow = net income + non-cash expenses ± changes in working capital
The indirect method starts from profit and removes everything that is not cash. Most published cash flow statements use it, because it explains why profit and cash differ.
Working Capital Adjustments
Calculate each change as the closing balance minus the opening balance, then apply this rule.
| Balance sheet item | If it increased | If it decreased |
|---|---|---|
| Accounts receivable | Subtract | Add |
| Inventory | Subtract | Add |
| Prepaid expenses | Subtract | Add |
| Accounts payable | Add | Subtract |
| Accrued expenses | Add | Subtract |
An increase in receivables means sales were booked but not yet collected, so cash is lower than profit. An increase in payables means costs were booked but not yet paid, so cash is higher than profit.
Indirect Method Example
| Line | Amount |
|---|---|
| Net income | 6,200.00 |
| Add: depreciation and amortisation | 1,400.00 |
| Less: increase in accounts receivable | −2,300.00 |
| Add: decrease in inventory | 800.00 |
| Add: increase in accounts payable | 1,100.00 |
| Add: increase in accrued expenses | 300.00 |
| Operating cash flow | 7,500.00 |
Switch the calculator to the indirect method and you get the same 7,500.00 as the direct method.
Operating Cash Flow vs Net Income
Net income and operating cash flow drift apart for three reasons: non-cash expenses (depreciation reduces profit but not cash), timing (credit sales and unpaid bills) and inventory (stock bought is cash spent before it becomes a cost). If operating cash flow is consistently below net income, look at how fast customers pay and how much stock you hold.
Cash Flow From Investing and Financing Activities
How to Calculate Cash Flow From Investing Activities
Investing cash flow = proceeds from selling assets and investments − capital expenditures − purchases of investments
Investing activities cover long-term assets: equipment, vehicles, property, capitalised software, and securities or loans to others. A negative figure is normal for a growing business, because it means the business is buying assets.
How to Calculate Cash Flow From Financing Activities
Financing cash flow = new borrowing + shares issued and owner contributions − loan principal repayments − dividends and owner drawings
Financing activities are transactions with lenders and owners. Only loan principal belongs here under US GAAP; interest paid stays in operating cash flow. For a sole trader or partnership, owner drawings are a financing outflow.
Where Common Items Belong
| Transaction | Section |
|---|---|
| Customer payments, supplier payments, wages, rent | Operating |
| Interest paid, income tax paid | Operating (US GAAP) |
| Buying or selling equipment, vehicles, property | Investing |
| Buying or selling shares and bonds held as investments | Investing |
| New loan received, loan principal repaid | Financing |
| Owner contributions, dividends, owner drawings | Financing |
| Transfers between your own bank accounts | Not a cash flow |
How to Find Free Cash Flow
Free cash flow = operating cash flow − capital expenditures
Free cash flow is the cash left after paying for the assets the business needs. In the example, operating cash flow of 7,500.00 minus capital expenditures of 9,500.00 gives free cash flow of −2,000.00: the month's equipment purchase was funded by the new loan, not by operations.
What Your Net Cash Flow Tells You
The sign of each section says more than the total.
| Operating | Investing | Financing | What it usually means |
|---|---|---|---|
| Positive | Negative | Negative | Healthy: operations fund investment and repay lenders or owners |
| Positive | Negative | Positive | Growing: investing more than operations can fund alone |
| Negative | Positive | Positive | Under pressure: selling assets and borrowing to cover operations |
| Negative | Negative | Positive | Early stage: funded by loans or owners while the business builds up |
One period rarely tells the whole story. Run the calculator for several months or quarters and watch the trend in operating cash flow.
Turn a Bank Statement Into a Cash Flow Report
Your bank statement already lists every receipt and payment for the direct method. To use it:
- Total the money in and money out. Upload the statement to the bank statement analyzer to get the totals and a breakdown of spending.
- Sort the lines by activity. Convert the statement to Excel and tag each row as operating, investing or financing.
- Remove transfers. Movements between your own accounts change neither section.
- Enter the totals above. Use the statement's opening balance as cash at the beginning of the period, and check that the calculated ending cash matches the closing balance.
If the ending cash does not match, reconcile the statement with your books to find the missing or duplicated entries.
The calculator is a self-help tool for estimates and learning. It is not accounting, tax or investment advice; for financial statements you file or share with lenders, ask a qualified accountant.
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Cash Flow Calculator FAQ
Net cash flow, operating cash flow and the cash flow statement, answered.
How do you find net cash flow?
Add the three cash flow totals for the period: net cash flow = operating cash flow + investing cash flow + financing cash flow. You can check the result by subtracting the opening cash balance from the closing cash balance; the two figures should be equal.
How do you find operating cash flow?
With the direct method, subtract cash paid to suppliers, staff, landlords, lenders (interest) and tax authorities from cash received from customers and other operating receipts. With the indirect method, start from net income, add back depreciation and other non-cash items, then adjust for changes in receivables, inventory, payables and other working capital.
What is the difference between the direct and indirect method?
Both give the same operating cash flow. The direct method lists actual cash receipts and payments, so it suits anyone working from bank statements. The indirect method reconciles net income to cash using the income statement and two balance sheets, which is how most published cash flow statements are prepared.
Can net cash flow be negative?
Yes. Negative net cash flow means more cash left the business than came in, so the cash balance fell. It is not automatically a problem: buying equipment or repaying a loan reduces cash on purpose. Repeated negative operating cash flow is the warning sign, because the core business is not generating cash.
Is net cash flow the same as profit?
No. Profit (net income) counts revenue when it is earned and expenses when they are incurred, including non-cash items such as depreciation. Net cash flow only counts money that actually moved. A profitable business can run short of cash if customers pay late or if it buys inventory and equipment faster than it collects sales.
Is interest paid an operating or financing cash flow?
Under US GAAP, interest paid is an operating cash flow. IAS 7 has let IFRS reporters choose operating or financing, and the amendments made by IFRS 18, effective for periods beginning on or after 1 January 2027, classify interest paid as financing for most companies. The calculator lists it under operating; move the amount to other financing payments if your framework requires it.
How do I calculate free cash flow?
Free cash flow = operating cash flow − capital expenditures. The calculator shows it under the summary using the operating total and the capital expenditures field. It is the cash left over after maintaining and growing the asset base, available to repay debt or pay owners.
What is the difference between investing and financing cash flow?
Investing cash flow covers buying and selling long-term assets and investments, such as equipment, property and securities. Financing cash flow covers money moving between the business and its lenders or owners: new loans, loan principal repayments, share issues, owner contributions, dividends and drawings.
Can I use the calculator for a cash flow forecast?
Yes. Enter the receipts and payments you expect for a future month or quarter instead of actual figures. The ending cash balance shows whether you will have enough cash, and a negative figure tells you how much funding the period needs.
Can I work out cash flow from my bank statement?
Yes, a bank statement is the raw material for the direct method: deposits are receipts and withdrawals are payments. Sort each line into operating, investing or financing and leave out transfers between your own accounts. Upload the statement to the bank statement analyzer to get the money-in and money-out totals, or convert it to Excel to sort the lines yourself.
Does the calculator send my figures anywhere?
No. The calculator runs entirely in your browser and nothing you type is uploaded or saved. Refreshing the page resets it to the example.
Get Your Cash Flow From a Bank Statement
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