Cash Gap Days Worksheet

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Annual Sales

Gross Margin

Annual
Daily
25,000,000 $
68,493
11%

Cost of goods(Material, labor, subcontractors)

Month
One

Month Ending Balance

Gap
Days

Inventory

500,000

Cost in Excess

Accounts Receivable

Month
Two

Month
Three

Gap
Days

60,959

Three Month
Average

650,000

11

850,000

14

666,667

11

1,000,000

16 $ 1,200,000

20

1,750,000

29

1,316,667

22

3,500,000

51 $ 3,750,000

55

3,900,000

57

3,716,667

54

Billings in excess

1,000,000

(15) $

500,000

(7) $

250,000

(4) $

583,333

(9)

Accounts Payable

2,300,000

(38) $ 2,100,000

(34) $

1,900,000

(31) $

2,100,000

(34)

CASH GAP DAYS

23

Average Cost per day

Cash Gap Days
Amount of Money
that needs to be borrowed

Borrowing rate
Borrowing Cost per day

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8 $

Gap
Days

22,250,000 $

43

23

43

1,425,000

$ 2,642,500

8.5%

8.5%

332

615

65

44
$

60,959
43.83

2,672,000

65
$

3,948,500

8.5%

920

8.5%

622

Before Changing days y

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Month Ending Balance

Average
Thousands

Inventory

667

11

11

Cost in Excess

1,317

22

21

Accounts Receivable

3,717

54

54

Billings in excess

583

Accounts Payable

2,100

34

34

44

44

CASH GAP DAYS

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There are some rounding issue involved with this spreadsheet

none are material, it has to do with the way the days round.

Average Cost per day

Cash Gap Days

Amount of Money

60,959
44

$ 2,666,966

that needs to be borrowed

Borrowing rate
Revised Borrowing cost per day
Actual Borrowing cost per day
Annualized Savings

$
$

8.5%
621
622

428