The formula to calculate the Days of Cash on Hand (D) is:
D=(CE)×N
Where:
Let's say the cash and cash equivalents (C) are $50,000, the operating expenses (E) are $5,000, and the number of days in the period (N) is 30. Using the formula:
D=(50,0005,000)×30=10×30=300
So, the days of cash on hand is 300 days.