Net Debt

Corporate Finance Financial Statements Financial Terms Dictionary

Contents

Net debt is a measure of liquidity used to determine how well a company can pay off all of its debts if they need to be paid off immediately.

Net debt shows how much cash would be left if all debts were paid and if the company had enough liquidity to meet its debt obligations.
Net debt is calculated by subtracting total cash and cash equivalents from total short-term and long-term debt.