Free Cash Flow Calculator

Operating Cash Flow Less Capital Expenditure

This free cash flow calculator subtracts cash capital expenditure from operating cash flow for the period you select. Enter both figures for the same entity and reporting period. Changing the period label does not convert or annualise either amount.

Operating cash flow keeps its sign. Enter a cash inflow as positive and cash used in operations as negative. Enter capital expenditure as a positive outflow amount, even when the statement prints that payment in brackets.

Correct entry: operating cash flow of $184,250 and capital expenditure of $62,750 gives $121,500 of free cash flow. Incorrect entry: entering capital expenditure as negative would add the outflow back. The calculator rejects negative capital expenditure.

Use cash paid for the capital assets included in your measure. Keep asset-sale proceeds separate rather than netting them against the purchase payments. Exclude non-cash asset additions, such as an asset acquired through a financing arrangement without an immediate cash payment.

The SEC’s free cash flow guidance, question 102.07 describes this common calculation and explains that definitions differ. A positive result can still precede compulsory debt repayments or other commitments.

Profit, Cash Balance and Free Cash Flow

Accounting profit measures income less expenses under the accounts’ recognition rules. Operating cash flow reflects the timing of cash receipts and payments. Depreciation reduces profit without a current cash payment, while unpaid invoices can increase profit before the cash arrives.

Closing cash starts with opening cash and includes the period’s operating, investing and financing movements, with any relevant exchange-rate effects. This calculator uses only operating cash flow and selected capital expenditure. A new loan can increase closing cash without increasing this free cash flow result.

The result is a cash-flow measure for one period. It does not calculate a discounted business value, unlevered free cash flow to the firm or free cash flow to equity. It makes no adjustments for interest classification or net borrowing.

For comparisons across entities, check how each statement classifies interest and which capital payments each free cash flow measure includes. A negative result means the entered operating cash did not cover the selected capital expenditure. It does not alone establish a loss or insolvency.

Reconcile the Source Figures

The default inputs are a fictional annual client statement. Its net cash from operating activities is $184,250. The investing section shows $62,750 paid for equipment. Enter $62,750 as positive capital expenditure and select Annual to reproduce the $121,500 result.

The same fictional statement starts with $36,800 cash and has $19,500 of net financing inflows. Assuming no other cash movements, closing cash is $177,800. That balance includes opening cash and financing, so it differs from the $121,500 free cash flow.

For a deficit example, enter -$12,000 of operating cash flow and $3,000 capital expenditure for one quarter. Free cash flow is -$15,000. With zero capital expenditure, the result equals operating cash flow.

AASB 107, Statement of Cash Flows separates operating, investing and financing cash flows and excludes non-cash investing and financing transactions from the statement. Match the source statement’s period and units before copying the figures. Multiply amounts reported in thousands by 1,000.

Keep the source statement and your selected capital-expenditure lines with the calculation. The result shows whole dollars after subtracting the entered cents. Your entries stay on this page without uploads or browser storage.