Net Debt Calculator
This net debt calculator helps you compute the net debt using the formula: Net debt = Short-term debt + Long-term debt – Cash and equivalents
Below is a screenshot of the net debt calculator:
Download the Free Template
Enter your name and email in the form below and download the free template now!
Net debt is a financial liquidity metric that measures a company’s ability to pay all its debts if they were due today. In other words, net debt compares a company’s total debt with its liquid assets. Net debt is the amount of debt that would remain after a company had paid off as much as debt as possible with its liquid assets. It is used to determine if a company can repay its obligations if they were all due today and whether the company is able to take on more debt.
Formula for Net Debt
Net debt = Short-term debt + Long-term debt – Cash and equivalents
- Short-term debts are financial obligations that are due within 12 months. Common examples of short-term debt include accounts payable, short-term bank loans, lease payments, wages, and income taxes payable.
- Long-term debts are financial obligations that are due beyond a 12-month period. Common examples of long-term debt include bonds, lease obligations, contingent obligations, notes payable, and convertible bonds.
- Cash and cash equivalents are the most liquid assets of a company. Common examples of cash and cash equivalents include marketable securities, commercial paper, treasury bills, and bank accounts.
More Free Templates
For more resources, check out our business templates library to download numerous free Excel modeling, PowerPoint presentation and Word document templates.