Enter the annual net income ($) and the average long-term debt ($) into the Return on Debt Calculator. The calculator will evaluate and display the Return on Debt.

## Return on Debt Formula

The following formula is used to calculate the Return on Debt.

ROD = ANI / ALD * 100

• Where ROD is the Return on Debt (%)
• ANI is the annual net income ($) • ALD is the average long-term debt ($)

## How to Calculate Return on Debt?

The following example problems outline how to calculate Return on Debt.

Example Problem #1:

1. First, determine the annual net income ($). • The annual net income ($) is given as: 50,000.
2. Next, determine the average long-term debt ($). • The average long-term debt ($) is provided as: 375,000.
3. Finally, calculate the Return on Debt using the equation above:

ROD = ANI / ALD * 100

The values given above are inserted into the equation below and the solution is calculated:

ROD = 50,000 / 375,000 * 100 = 13.33 (%)

Example Problem #2:

For this problem, the variables needed are provided below:

annual net income ($) = 75,000 average long-term debt ($) = 1,000,000

This example problem is a test of your knowledge on the subject. Use the calculator above to check your answer.

ROD = ANI / ALD * 100 = ?