Capacity primarily refers to a comp

Capacity primarily refers to a company's ability to repay med-term debt, or the level of cash protection against med-term debt. The ability to pay can be ded up into long-term and short-term psy to capacity, depending on the length of the repayment period. Short-term payability depends primarily on the liquidity quality of assets, while long-term payability depends primarily on a company's capital structure and profitability.