With the illustrative inputs below, the result is 98.6301 .
Try this with your own numbersFormula and worked example
Carrying cost = invoice × annual rate × delay days / 365
| Input | Example |
|---|---|
| Unpaid invoice amount | 10,000 |
| Days delayed | 30 days |
| Annual cash carrying-cost assumption | 12 % |
| Calculated result | 98.6301 |
Choose reliable inputs
Account for delivery time, review work and when you expect to be paid for each engagement. For this insurance agency calculation, use time sheets, engagement scopes and invoice ageing and a consistent definition of one policy sale.
- Lead costs: include the portion belonging to this policy sale or reporting period, and record where the value came from.
- Service time: include the portion belonging to this policy sale or reporting period, and record where the value came from.
- Renewal work: include the portion belonging to this policy sale or reporting period, and record where the value came from.
Use the same currency for every money input. Do not mix weekly costs with monthly revenue, or count the same expense in both an itemised cost and allocated overhead.
Can I charge this amount to the customer?
This tool estimates internal cost only. Contract terms and local law determine whether any fee may be charged.
Uses simple interest and a 365-day year; this is not a lawful late-payment fee calculation.
What if this input changes?
If unpaid invoice amount rises by 10%, this example changes by 9.863 . This shows the effect of one change; it does not predict what will happen.
Open the calculator, save your baseline, then change the input supported by the least reliable estimate in your records. Compare both scenarios before committing to a price or capacity promise.