What is the Cash At End Of Period of a Company?

Cash At End Of Period: TL;DR

The Cash At End Of Period is the amount of cash a company has when its accounting period ends. This can be a month, a quarter, or a year. It's a measure of a company's liquidity or its ability to cover its current liabilities and expenses.

Cash At End Of Period = Cash at the start of the period + Cash inflows - Cash outflows

In-Depth Understanding

Expanding on the basic definition, the Cash At End Of Period is a snapshot of a company's financial position at a specific point in time. It includes all cash inflows, such as revenue from sales, investments, financing activities, and other sources, and all cash outflows, such as costs of goods sold, operating expenses, taxes, and other payments.

Changes in the Cash At End Of Period can reflect a company's operating performance, investment activities, and financial situation. A high cash balance can indicate strong sales, efficient cost management or successful investments. Conversely, a low or decreasing cash balance may signal poor sales, high expenses or unsuccessful investments.

However, a high cash balance isn't always a good sign. It could also mean the company isn't investing its resources effectively. Therefore, it's crucial to analyze this figure in relation to other financial indicators and the specifics of the company's industry and operations.

Real-world Examples

A Retail Company - Amazon Inc.

For Amazon, Cash At End Of Period is calculated by adding the cash at the beginning of the period to the cash inflows from sales, investments, and financing activities, and subtracting the cash outflows for costs of goods sold, operating expenses, and other payments.

A Technology Company - Apple Inc.

Apple's Cash At End Of Period is calculated by adding the cash at the beginning of the period to the cash inflows from sales of its products and services, investments, and financing activities, and subtracting the cash outflows for costs of goods sold, research and development expenses, and other payments.

A Food and Beverage Company - Coca Cola Co.

For Coca Cola, Cash At End Of Period is determined by adding the cash at the beginning of the period to the cash inflows from sales of its beverages, investments, and financing activities, and subtracting the cash outflows for costs of goods sold, marketing expenses, and other payments.