Payment Terms Cash Flow Calculator
How much cash does moving from Net 30 to Net 60 tie up?
Sales on the new terms × 12 × the extra days ÷ 365. For the sample business that is $20,515 of cash that stops arriving for 60 days instead of 30 — a one-off hole that costs $2,462 a year to finance, the same as giving a 0.99% discount on every sale on those terms.
When a customer asks for Net 60 or Net 90, the price stays the same but your cash does not. The switch creates a gap once — for the extra days, invoices go out and nothing comes back — and that money stays out for as long as the terms last. This calculator prices both and checks whether your cash can carry it.
PassYour cash can carry Net 60: the $20,515 gap fits above the reserve. It still costs $2,462 a year — about a 0.99% discount.
| One-off cash gap | $20,515 | cash that stops arriving while Net 30 becomes Net 60 |
|---|---|---|
| Cash waiting in receivables | $20,515 → $41,030 | on these sales, before → after the change |
| Yearly cost of the change | $2,462 | the gap financed at 12.0% a year |
| Same as a discount of | 0.99% | on every sale made on the new terms |
| Cash above reserve after the gap | $17,485 | what is left of your cushion once the gap has opened |
| Longest terms your cash can carry | Net 85 | before the gap reaches your reserve |
| Terms | Cash waiting | Versus today | Yearly cost of all cash waiting |
|---|---|---|---|
| Net 0 | $0 | -$20,515 | $0 |
| Net 15 | $10,258 | -$10,258 | $1,231 |
| Net 30 | $20,515 | $0 | $2,462 |
| Net 45 | $30,773 | +$10,258 | $3,693 |
| Net 60 | $41,030 | +$20,515 | $4,924 |
| Net 90 | $61,545 | +$41,030 | $7,385 |
| Net 120 | $82,060 | +$61,545 | $9,847 |
Runs in your browser with fixed, tested formulas — the same exact arithmetic as the Business X-Ray. Nothing you type is sent or stored.
One question answered. Eight more are waiting.
This page tests one thing with a few monthly numbers. The Business Decision X-Ray runs your whole business through the same engine, day by day: nine tests, the exact breakpoint, the smallest repair and a dated action plan. Open demo of every section, no sign-up.
How this calculator works
On any terms, the cash waiting in receivables is roughly one day of sales for every day of terms. One day of sales is monthly sales on those terms × 12 ÷ 365 ($684 for the sample). Moving from Net 30 to Net 60 adds the difference: $20,515.
That gap opens once, in the weeks after the change, and then stays open for as long as the terms last. Financing it costs your cost of money every year. Dividing that cost by a year of sales gives the discount it is equivalent to — a cleaner way to compare terms with a price change.
If you enter your cash, the calculator checks the gap against the cash above your reserve and finds the longest terms that still fit (85 days for the sample), and the deposit that would close the gap if they do not.
The formula
Cash waiting = monthly sales on terms × 12 × days ÷ 365.
One-off gap = cash waiting on new terms − cash waiting on current terms.
Yearly cost = gap × cost of money. Equivalent discount = yearly cost ÷ yearly sales on terms.
Longest safe terms = current days + (cash − reserve) × 365 ÷ yearly sales on terms, rounded down.
Worked example
A large customer brings 40% of the sample business's sales and asks to move from Net 30 to Net 60. The gap is $20,515. It fits above the reserve, so the business can say yes — but it is paying $2,462 a year for the privilege, roughly a 0.99% discount the customer never asked for. That number is a fair thing to negotiate with: a small price increase, a deposit, or Net 45 instead of Net 60.
What this calculator does not do
- It assumes sales are spread evenly through the month and customers pay on the day terms end.
- Late payment beyond the terms, bad debt and early-payment discounts are not modelled here.
- The day-by-day effect on payroll dates is what the Business X-Ray's Payment Delay test shows.
Questions people ask
What does Net 30 mean?
The invoice is due 30 days after the invoice date. Net 60 and Net 90 mean 60 and 90 days. The longer the terms, the longer your money sits with the customer.
Is Net 60 bad for a small business?
Not automatically. It is a loan to your customer. It is fine when your cash can carry the gap and the price covers the cost of that loan; it is dangerous when the gap reaches your reserve.
What if customers already pay late?
Enter the days they actually pay in, not the days on the invoice. If Net 30 customers pay in 45 days, your current terms are 45.
What is a reasonable cost of money?
The rate you would pay to borrow the gap — your overdraft or credit line rate. If you would not borrow, use the return you could earn on the cash instead. The default 12% is only a placeholder.
Related decisions
- Deposit Calculator — The smallest deposit that keeps a big order from draining your cash.
- Customer Concentration Risk Calculator — Which customer's loss would put you in the red — and how fast.
- Cash Runway Calculator — How many months your cash lasts — now, with no sales, and if sales fall.
- Cash Conversion Cycle Calculator — How many days your cash is stuck, and how much money that ties up.
- What if my biggest client pays late? Net 30 to Net 60
- How much deposit should I ask for on a big order?
Formulas reviewed 26 September 2026
