It is not possible to have negative Cash on Hand
Petty cash and money in bank accounts
∑of money immediately available
= Cash on Hand
CoH at beginning of period
= Cash on Hand at end of period
At the beginning of February a company has 52.000 € Cash on Hand. In February they have expenses of 12.000 € and receipts of 8.000 €. Their Cash on Hand at the end of the month is therefore calculated as follows:
Cash Balance/Cash/Liquid Assets
Q: Can I just add the months Revenue and deduct the months Total Cost to get my new Cash on Hand?
A: Usually not, as the sale and the actual cash flow do not necessarily occur in the same month.