This workout asks us to calculate net debt for both periods We have a balance sheet for year 9 and year 8. I'm going to scroll down to the liabilities section to see if we can find any debt items first Let's look within the current liabilities first and I can see short term borrowings That's definitely a debt item, so for year 9 that's 2,708 Sticking to the current liabilities, I look down again accounts payable? No Accrued Liabilities? No. Accrued income taxes? No, they're all operating items But long-term debt due within one year, that's definitely a debt item, so 2,745 in year 9 And underneath that we have capital lease and financing obligations due within one year of 551 I'm going to put all of them into my answer So here's the beginnings of my answer, short term borrowings, long term debt due within one year and capital lease due within one year. So those figures we've already got in. I now want to go looking for any longer term items, so let's go have a look at long term liabilities And the first one, long-term debt 38,214 Underneath that we've got long term capital lease and financing obligations of 5,816 Let's put them into our answer So long term debt, long term capital lease and there are our figures So I will sum all of those up and then take off any cash or cash equivalent Let's go up and see if we can find any at the top So I'm looking into the asset section, in particular the current assets and we do have some cash and cash equivalents In year 9 that was 8,705 I quickly scanned down through the rest, receivables, inventory, prepaid expenses But nothing else that looks like a cash or cash equivalents So let's put cash into our answer And I now need to come up with my net debt calculation My net debt calculation says I need to sum up all of the debt items and then subtract off the cash at the bottom If I do that, I get a figure of 41,329 And there's my calculation, add up the debt items and subtract cash And I need to do exactly the same thing in year 8 Add up the debt items and subtract off cash