Cash Reserve
Your cash balance as a percentage of your Last Twelve Months sales. This is a liquidity measure (not profitability): shows how many months of sales you have sitting in the bank as a safety cushion. Can be positive even when burning cash.
- How it's worked out
- (Cash Balance / LTM Sales) × 100
- Which way is better
- Higher is betterHigher is better for cash.
Written by Mandy Walker, founder of Focus on Cash. Updated October 2026. This explanation comes from the glossary inside Focus on Cash, so it matches the words you see in the app.
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