Methodology, examples, and practical guidance
Cash Flow Calculator: Ending Cash Balance
A cash forecast follows when money actually enters or leaves the business. Include customer receipts, payments, and other cash movements expected during one consistent period, regardless of when the related revenue or expense is recognized.
THE METHOD
The formula
Use the following method with your own business figures.
This is a period-end total. It does not show whether cash runs short between an early payment and a later receipt.
PUT IT TO WORK
A worked example
These figures illustrate the calculation, not a recommended business target.
- $24,500 cash coming in − $20,100 cash going out = $4,400 net inflow.
- $18,000 starting cash + $4,400 net inflow = $22,400 ending cash.
The example month adds $4,400 to cash reserves and ends at $22,400.
USE THE RESULT
How to interpret the number
Put the result in context
A positive closing balance does not eliminate timing risk. Break the forecast into weeks when large payments fall before expected customer receipts.
CHECK YOUR ASSUMPTIONS
Common mistakes
Check the inputs and assumptions
Do not count an unpaid invoice as money already received. Include cash items such as loan proceeds, principal repayments, equipment purchases, and owner withdrawals where relevant.
Questions business owners ask
Use these answers to refine the assumptions behind the calculator—not as a substitute for advice specific to your business.
Why can a profitable business have negative cash flow?
Receivables may remain unpaid while bills are due. Cash can also leave for inventory, equipment, or debt repayment in ways that differ from the period's profit calculation.
Planning note: Use this educational estimate alongside your records and qualified professional advice for significant business decisions.