How much debt the earnings carry calculator

How much debt the earnings carry, worked through in your browser.

Interactive: how much debt the earnings carryMedium

Two tests bind a financing — a leverage ceiling and an interest-cover floor — and only the tighter of the two is the answer. Which one binds tells you what the structure is really exposed to.

EBITDA ($m) Maximum leverage (× EBITDA) All-in borrowing rate % Minimum interest cover (×) Capex ($m) Cash tax ($m)

Capacity on the leverage test: —
Capacity on the cover test: —
Debt capacity: —
Annual interest: —
Cash after everything: —
Which test binds: —
Reading: —

One year, no amortisation, no working-capital swing. A real credit paper does all three, and they usually make the answer smaller. Information and education only. Not advice, not a valuation, and not a quote for anything.

The idea behind it

This calculator belongs to Leveraged Finance, where the mechanism it computes is explained step by step, with the formula, what each input means and where the simple model stops being right. Everything is computed in your browser; nothing you type is sent anywhere.

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Not advice. This explains how something works; it is not a recommendation, and nothing here is tailored to you. You can lose everything you put in — with leveraged instruments, considerably more. StrikeAndYield is not a regulated firm and provides no financial services.

The same in full — six points, and why each one matters

No advice, no recommendation. Nothing on this page constitutes investment, financial, legal, tax or accounting advice, a personal recommendation, or an offer or solicitation to buy or sell any financial instrument.
Nothing here is tailored to you. This is written for a general audience. It does not consider your objectives, financial situation, knowledge, time horizon or tolerance for loss.
The examples are simplified. Worked examples use round numbers and leave out costs, spreads, taxes, collateral, settlement and market conventions that materially change real outcomes.
The models are teaching models. Formulas shown are standard textbook formulations. Institutions add calibration, live market data and credit, funding and capital adjustments — nothing here will reproduce a dealer’s quote or produce a valuation you can rely on.
These instruments carry risk. You can lose your entire investment. Leveraged instruments — futures, options, CFDs, perpetual futures and similar — can cost you considerably more than you originally deposited.
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