.ocf-input-group { margin-bottom: 20px; }
.ocf-input-group label { display: block; font-weight: 700; margin-bottom: 8px; color: #2c3e50; }
.ocf-input-group input { width: 100%; padding: 12px; border: 2px solid #ddd; border-radius: 4px; box-sizing: border-box; font-size: 16px; transition: border-color 0.3s; }
.ocf-input-group input:focus { border-color: #3498db; outline: none; }
.ocf-calc-btn { background-color: #27ae60; color: white; padding: 15px 25px; border: none; border-radius: 4px; cursor: pointer; font-size: 18px; font-weight: bold; width: 100%; transition: background-color 0.3s; }
.ocf-calc-btn:hover { background-color: #219150; }
.ocf-result-box { margin-top: 30px; padding: 20px; background-color: #f8f9fa; border-left: 5px solid #27ae60; border-radius: 4px; }
.ocf-result-box h3 { margin-top: 0; color: #2c3e50; }
#ocf-value { font-size: 28px; font-weight: 800; color: #27ae60; }
.ocf-info-section { margin-top: 40px; border-top: 1px solid #eee; pt: 30px; }
.ocf-info-section h2 { color: #2c3e50; margin-top: 30px; }
.ocf-formula { background: #f1f1f1; padding: 15px; border-radius: 4px; font-family: monospace; display: block; margin: 15px 0; }
.ocf-helper-text { font-size: 13px; color: #666; margin-top: 4px; }
function calculateOperatingCashFlow() {
var ni = parseFloat(document.getElementById('netIncome').value) || 0;
var da = parseFloat(document.getElementById('depreciation').value) || 0;
var ar = parseFloat(document.getElementById('changeAR').value) || 0;
var inv = parseFloat(document.getElementById('changeInventory').value) || 0;
var ap = parseFloat(document.getElementById('changeAP').value) || 0;
var ocf = ni + da – ar – inv + ap;
var resultContainer = document.getElementById('result-container');
var resultValue = document.getElementById('ocf-value');
var resultText = document.getElementById('ocf-interpretation');
resultValue.innerHTML = '$' + ocf.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
resultContainer.style.display = 'block';
if (ocf > ni) {
resultText.innerHTML = "Your cash flow is higher than your net income, which often indicates high-quality earnings and efficient management of working capital.";
} else if (ocf > 0) {
resultText.innerHTML = "Your business is generating positive cash flow from operations, though it is currently lower than your reported net income.";
} else {
resultText.innerHTML = "Warning: Your operating cash flow is negative. This means the business is consuming more cash than it generates from operations, which may require external financing.";
}
resultContainer.scrollIntoView({ behavior: 'smooth', block: 'nearest' });
}
Operating Cash Flow (OCF) Calculator
Bottom line profit from the income statement.
Non-cash expenses added back to net income.
Enter the amount by which receivables increased (use 0 if they decreased).
Enter the increase in inventory value (use 0 if it decreased).
Enter the increase in liabilities (bills you haven't paid yet).
Calculated Operating Cash Flow:
$0.00
What is Operating Cash Flow?
Operating Cash Flow (OCF) measures the amount of cash generated by a company's normal business operations. Unlike Net Income, which includes non-cash items and accounting adjustments, OCF provides a clear picture of the actual cash moving through the business.
The OCF Formula (Indirect Method)
This calculator uses the indirect method, which is the standard for financial reporting. The formula is:
Operating Cash Flow = Net Income + Depreciation/Amortization – Increase in Current Assets + Increase in Current Liabilities
Understanding the Components
- Net Income: Your total earnings or profit.
- Depreciation & Amortization: Since these are non-cash expenses that were subtracted to reach Net Income, they must be added back.
- Accounts Receivable (AR): If AR increases, it means you made sales but haven't received the cash yet, so we subtract the increase.
- Inventory: Purchasing more inventory uses cash, so an increase in inventory reduces your cash flow.
- Accounts Payable (AP): If your AP increases, you are keeping cash in the business longer by delaying payments to suppliers, which increases cash flow.
Example Calculation
Imagine a small retail business with the following annual figures:
- Net Income: $100,000
- Depreciation: $15,000
- Increase in Receivables: $10,000
- Increase in Inventory: $5,000
- Increase in Payables: $8,000
The Calculation: $100,000 + $15,000 – $10,000 – $5,000 + $8,000 = $108,000
Even though the profit was $100,000, the business actually generated $108,000 in actual cash from its operations.