## Free Cash Flow Calculator

The free cash flow measures the amount of cash flow available for a business to use for growth and to take advantage of expansion opportunities.

The Excel free cash flow calculator, available for download below, is used to compute free cash flow by entering details relating to the net credit sales and the opening and closing accounts receivable balances.

Free Cash Flow Calculator November 6th, 2016

## Cash Conversion Cycle

When a business trades, it purchases goods, holds them as inventory, pays for the inventory, converts them to a product for sale and sells them on credit, and finally it collects the cash from the sale.

The cash flow cycle is the time period from when cash is paid out for inventory, to when cash is received from sales. The cash conversion cycle differs from the operating cycle as it allows for the accounts payable payment period. It measure the time between the payment for inventory and the receipt of cash from customers, whereas the operating cycle measures the time between purchasing the inventory and receiving cash from customers.

Cash Conversion Cycle November 6th, 2016

## Operating Cycle

When a business trades, it purchases goods, holds them as inventory, converts them to a product for sale and sells them on credit, and finally it collects the cash from the sale. The operating cycle in financial management describes the time it takes to complete this process in days.

The operating cycle definition is the time period it takes from inventory purchase until the receipt of cash.

Operating Cycle November 6th, 2016

## Free Cash Flow

Free cash flow (FCF) is calculated by taking the operating cash flow and deducting the capital expenditure.

The purpose of free cash flow is to see what cash is available (free) from the operations of the business after allowing for cash to maintain the current growth rate. This free cash flow is then available to improve growth by taking advantage of expansion opportunities, invest in new products, and to reduce debt and pay dividends to equity providers.

Free Cash Flow November 6th, 2016

## Working Capital Calculator

The working capital calculator can be used by any business to estimate the cash needed to fund its working capital.

Working capital is the amount of cash needed to fund the normal day to day trading operations of the business. In a simple business it would be calculated as inventory + accounts receivable – accounts payable which represents the funding needed to buy inventory and provide credit to customers, reduced by the amount of credit obtained from suppliers.

Working Capital Calculator November 6th, 2016

## Operating Cash Flow from Trading Activities

Operating cash flow is that part of the cash flow generated by the trading activities of the business. It is basically the net income of the business adjusted for depreciation and amortization, and movements in working capital (inventory, accounts receivable, and accounts payable). It represents cash in from selling goods and services less cash out from paying the costs of selling goods and services.

Operating Cash Flow from Trading Activities September 27th, 2017

## Related pages

what is uncollectible accountspurchase price allocation exampleaccounting eqationformat of general ledgerreorder point calculation examplefinished goods inventory calculationabc inventory systemmarkup & margindefinition of capital expenditure and revenue expendituresingle step multi step income statementaccounts payable ledgergrowth in perpetuityis unearned rent a liabilitypetty cash vouchersasset turnover ratio examplebookkeeping depreciationcash received receipt templateverifiability in accountingrequisition form template download freecalculate days receivableexcel prove it test answerssales ledger sampleannuity growth calculatoraccrued income journal entrytime sheet templatescar loan accounting entryhow to solve bank reconciliation statementaccounting equation calculatoraccumulated depreciation general ledgerprintable petty cash logcommon size income statement exceltill reconciliation templatehistory of double entry bookkeepingdouble entry for accounts receivablehow to create suspense account in tallypurchase ledger reconciliationjournal entries for variancesaverage debtor dayswhat accounts belong in the general ledgerbank reconciliation statement pdf noteswhat is freight out in accountingproject accounting revenue recognition methodsdisposal of fixed assets definitionrule of 78 sales calculatoraverage number of days to collect accounts receivable formulasteps to prepare bank reconciliation statementsundry debtors definition accountingpv of annuity factorfactoring receivables definitiontotal variable manufacturing cost per unit formulareceivable discountingimprest account definitionstock valuation calculatordays of sales outstanding formulacontribution margin statement examplejournal entry for accounts payableledger debitadjusting entry unearned revenueentry for accrued interestadvantages of imprest system of petty cashsales turnover ratio formulacash conversion calculatorallowance for impairment of receivables journal entrydefinition of acid test ratiofreight collect fobexcel paybackpay dividend journal entrycalculating fv in excelhow to calculate markup and margintransposition accountingwhat are debtors on a balance sheetwhen is a trial balance preparedcalculating annuities duemultiple step income statementaccounts receivable days on hand formulastock obsolescenceexample of journalizing in accounting