Operating Cash Flow (OCF) Calculator

How to calculate Operating Cash Flow (OCF) :

Operating Cash Flow(OCF) is the amount of cash generated by the regular operating activities of a business within a specific time period.

Formula (short form or Direct Method) :

Operating Cash Flow = Net Income + Non-Cash Expenses - Increase in Working Capital

Formula (long form or Indirect Method) :

Operating Cash Flow = Net Income + Depreciation + Stock Based Compensation + Deferred Tax + Other Non Cash Items - Increase in Accounts Receivable - Increase in Inventory + Increase in Accounts Payable + Increase in Accrued Expenses + Increase in Deferred Revenue

If OCF is negative, it means a company has to borrow money to do things.

When net income is high than OCF it may be possible that they have a difficult time collection receivable from the customer.