Burn Rate & Runway Calculator

Inspectable records

Ledger state

The current ledger marks this instrument verified clean within the source-bound verification corpus.

Area

Finance, Economics & Business (educational only — never individualized investment, tax, or legal advice)

Tranche

tranche-5

Evidence ID

t5-008

Ledger rows

1

No ledger note is attached.

Review findings

The core burn formula is standard, but the specification is not complete enough for an unambiguous production result. Define behavior for burn<=0, negative cash, direct-net-burn precedence, and zero-cash-date calculation before approval.

Formula and scope findings

• burn=monthly_expenses-monthly_revenue is correct for net cash burn when both inputs are positive monthly cash-flow amounts.
• runway=cash_balance/burn is correct only when burn>0 and cash_balance is nonnegative; burn=0 causes division by zero, while burn<0 indicates cash generation rather than finite runway.
• The zero-cash date has no specified formula, as-of date, calendar-month convention, or treatment of fractional months.
• The alternative input 'net burn directly' is ambiguous because the spec does not define whether it replaces the revenue and expenses inputs or how conflicting values are handled.

Unit assumptions

• Monthly revenue, monthly expenses, and net burn must use the same currency and the same time basis; amounts are assumed to be currency units per month.
• Cash balance is assumed to be a currency amount in the same currency as revenue and expenses, not an annual amount, daily amount, or value in minor units such as cents.
• Runway is measured in months and assumes constant monthly net burn with no seasonality, financing, taxes, one-time costs, or timing effects.
• For the worked date examples, a zero-cash date cannot be calculated from the provided specification because no as-of date or date convention is defined.

Boundary hardening

BREAK_CLAIMED · SELF_FLAGGED

The instrument reaches an undefined division-by-zero result when monthly expenses equal monthly revenue, and its raw formula produces negative runway values for cash-generating cases. Without explicit handling, the UI can show an invalid or misleading runway and zero-cash date.

Errata and corrections

No applied erratum is attached to this unique-name record.

Inspectable example

4 review vectors are recorded. One source-bound sample is shown below.

{
  "inputs": {
    "cash_balance": 180000,
    "monthly_revenue": 20000,
    "monthly_expenses": 50000
  },
  "expected_outputs": {
    "net_burn_per_month": 30000,
    "runway_months": 6,
    "zero_cash_date": null
  },
  "working": "burn = 50,000 - 20,000 = 30,000 currency units/month. runway = 180,000 / 30,000 = 6 months. A zero-cash date cannot be computed because the spec provides no as-of date or date-conversion rule."
}

Related workflows

Sources and evidence

These pointers bind the page to evidence. They do not grant authority or collapse verification into deployment.

• VERIFIED_LEDGER.json · VERIFIED_CLEAN
• evidence-tranche5/tranche5-results.json
• BOUNDARY_HAZARD_CATALOG.json