💳 Net Debt Calculator
Calculate net debt
Short-term debt + Long-term debt
How to Use This Calculator
Enter Total Debt
Input the total debt - short-term debt plus long-term debt from the balance sheet.
Enter Cash and Cash Equivalents
Enter cash and cash equivalents - liquid assets that can be used to pay off debt.
Review Net Debt
See the net debt - the debt remaining after subtracting cash and cash equivalents. Net debt provides a better picture of debt burden by accounting for available cash.
Formula
Net Debt = Total Debt - Cash and Cash Equivalents
Example Calculation:
If total debt $500,000, cash and cash equivalents $100,000:
• Net debt = $500,000 - $100,000 = $400,000
• This is the debt remaining after accounting for available cash
About Net Debt Calculator
A net debt calculator helps you calculate the debt remaining after subtracting cash and cash equivalents. Net Debt = Total Debt - Cash and Cash Equivalents. Net debt provides a better picture of a company's debt burden by accounting for available cash that can be used to pay off debt. Net debt is an important metric for assessing financial health, creditworthiness, and debt capacity. Lower net debt indicates better financial health, while negative net debt (net cash position) indicates the company has more cash than debt.
When to Use This Calculator
- Financial Analysis: Assess debt burden and financial health
- Credit Analysis: Evaluate creditworthiness
- Investment Analysis: Analyze company financial position
- Debt Analysis: Understand debt capacity and risk
Understanding Net Debt
- Positive Net Debt: More debt than cash (net debt position)
- Negative Net Debt: More cash than debt (net cash position)
- Better Metric: Better indicator than gross debt
- Financial Health: Lower net debt indicates better financial health
Why Use Our Calculator?
- ✅ Financial Analysis: Calculate net debt accurately
- ✅ Credit Analysis: Evaluate creditworthiness
- ✅ Investment Analysis: Analyze financial position
- ✅ Debt Analysis: Understand debt capacity
- ✅ 100% Free: No registration or payment required
Frequently Asked Questions
What is net debt?
Net debt is the debt remaining after subtracting cash and cash equivalents from total debt. Net Debt = Total Debt - Cash and Cash Equivalents. Net debt provides a better picture of a company's debt burden by accounting for available cash that can be used to pay off debt. Net debt is an important metric for assessing financial health, creditworthiness, and debt capacity. Lower net debt indicates better financial health, while negative net debt (net cash position) indicates the company has more cash than debt.
Why is net debt important?
Net debt is important because it: (1) Better metric - provides better picture than gross debt by accounting for available cash, (2) Financial health - indicates debt burden and financial health, (3) Creditworthiness - used by creditors to assess creditworthiness, (4) Investment analysis - helps investors evaluate financial position, (5) Debt capacity - shows how much debt the company can take on. Net debt is often used in financial ratios and credit analysis.
What does negative net debt mean?
Negative net debt (net cash position) means the company has more cash and cash equivalents than total debt. This indicates: (1) Strong financial position - company has excess cash, (2) Low debt burden - minimal debt relative to cash, (3) Financial flexibility - cash available for investments or opportunities, (4) Conservative financing - company is conservatively financed. Negative net debt is generally positive and indicates strong financial health, though it may also indicate the company is not optimally using its capital.
How is net debt different from total debt?
Total debt is the gross amount of debt, while net debt is total debt minus cash and cash equivalents. Total debt: (1) Shows gross debt - all debt obligations, (2) Doesn't account for cash - doesn't consider available cash, (3) Higher number - typically higher than net debt. Net debt: (1) Shows net debt burden - debt after cash, (2) Accounts for cash - considers available cash, (3) Better metric - better indicator of debt burden, (4) Used in analysis - commonly used in financial analysis. Net debt provides a more accurate picture of debt burden.