Not fully cash - includes accrued sales and expenses. Assumes no cash outflows for net working capital needs, capital expenditures or dividends. Assumes preferred dividends cannot be suspended. The amount of debt in relation to the book value of the shareholders' investment. A standard ratio.
Debt includes capital leases.
Book value of equity may be less than its market value. Book value of equity includes reserves, adjustments and accrued income. The proportion of debt in the firm's invested capital. A standard ratio. Debt includes capital leases.