Daily cash expenditures are the amount of money that a business spends on its daily operations, such as cost of goods sold, operating expenses, and additional expenses. Tracking daily cash expenditures is important for managing cash flow and budgeting. In this article, we will show you how to calculate daily cash expenditures in Excel using a simple formula and a table.
Formula
The formula for daily cash expenditures is:
where:
- Annual Operating Expenses are the total expenses incurred by the business in a year, excluding non-cash charges such as depreciation and amortization.
- Non-cash Charges are the expenses that do not affect cash flow, such as depreciation and amortization.
- 365 is the number of days in a year.
Procedure
To calculate daily cash expenditures in Excel, follow these steps:
- Enter the annual operating expenses and non-cash charges in two separate cells, such as B2 and B3.
- Enter the formula
=(B2-B3)/365in another cell, such as B4. This will give you the daily cash expenditures. - Format the cell as currency or number with two decimal places.
Example
Let’s say we have a business that has an annual operating expense of $500,000 and a non-cash charge of $50,000. We want to calculate the daily cash expenditure for this business. We can use the formula and the table as shown below:
| Annual Operating Expenses | Non-cash Charges | Daily Cash Expenditures |
|---|---|---|
| $500,000 | $50,000 | =(B2-B3)/365 |
The result is:
| Annual Operating Expenses | Non-cash Charges | Daily Cash Expenditures |
|---|---|---|
| $500,000 | $50,000 | $1,232.88 |
This means that the business spends $1,232.88 on average per day on its daily operations.
Other Approaches
There are other ways to calculate daily cash expenditures in Excel, such as using the AVERAGE function or the SUM function. For example, if we have a list of monthly operating expenses and non-cash charges, we can use the following formulas:
=AVERAGE(B2:B13-C2:C13)/30to get the average daily cash expenditure based on the monthly data.=SUM(B2:B13-C2:C13)/365to get the total annual cash expenditure divided by 365 days.
Both formulas will give the same result as the previous one, but they may be more convenient if we have the data in a different format.
