Cash Flow Ratios Calculator

This cash ratios calculator uses operating cash flow instead of net income to calculate three financial ratios. Unlike net income, cash flow is an objective measure of performance which cannot be manipulated or distorted using accounting assumptions and opinions.

Cash Flow Ratios Calculator September 26th, 2017Team
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Cash Flow Ratio Analysis

Cash flow ratios can be calculated using cash flow from operating activities found in the cash flow statement of a business. Using cash flow avoids the use of net income which is a subjective measure traditionally used in the calculation of accounting ratios.

Cash Flow Ratio Analysis September 25th, 2017Team
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Relationship Between Financial Statements

The four main financial statements are the income statement, statement of retained earnings, balance sheet, and cash flow statement. All four statements are interrelated and allow the user to more fully understand the financial performance of the business through the analysis of its financial statements.

Relationship Between Financial Statements January 26th, 2017Team
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Non Cash Expenses

Non cash transactions are expenses such as depreciation, bond amortization, and share based compensation expenses which are simply accounting entries and do not involve the movement of cash.

Non Cash Expenses November 6th, 2016Team
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Vertical Analysis

Vertical analysis definition: A technique of analyzing financial statements by restating each line item (e.g. sales and marketing expenses) as a percentage of another base line item (e.g. Revenue). The horizontal analysis reports are not required by Accounting Standards, and are used more as a management tool rather than a formal reporting document.

Vertical Analysis November 6th, 2016Team
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Nonprofit Financial Statements

A nonprofit organization (NPO) is an organization that has no owners and which uses its net income to help it achieve the aims for which it was established. All surplus net income has to be kept within the organization, and not paid out as dividends or distributions.

There are three main not for profit financial statements, the statement of financial position, the statement of activities, and the statement of cash flows.

Nonprofit Financial Statements November 6th, 2016Team
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Cash Flow Statement Analysis

It is quite feasible for a business to show a healthy balance sheet and be profitable, but if it runs out of cash it will fail.

The balance sheet only shows the position at a particular point in time, and the income statement deals in profit not cash. The purpose of the business cash flow analysis is to correct this situation.

Cash Flow Statement Analysis July 20th, 2017Team
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Classification of Cash Flows

The classification of cash flows into one of three types of business activity (operating, investing, or financing), is to help the user of the statement of cash flows to understand how the business generates and uses cash.

Classification of Cash Flows November 6th, 2016Team
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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, 2016Team
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Payback Period

The payback period is the time it takes to earn back the cash invested in a project. It allows a business to determine how long it will take before a project will recover it’s original investment.

The simple payback period, is a useful tool for a business to compare projects. Using the payback period method, the business would choose the project which has the shortest cash payback period.

Payback Period November 6th, 2016Team
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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, 2016Team
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