Enterprise value is a measure of firm value that is very closely related to market capitalization. Instead of focusing on only the market value of outstanding shares of stock, it measures the market value of outstanding shares of stock plus the market value of outstanding interest bearing debt less cash on hand. As an enrolled agent it is important to know basic concepts like enterprise value, when advising corporations on how to maximize value. For example, it's possible to know the market capitalization of a company but we do not know the market value of its outstanding interest bearing debt. In this situation, the common practice is to use the book value of outstanding interest bearing debt less cash on hand as an approximation.
The purpose of the EV measure is to better estimate how much it would take to buy all of the outstanding stock of a firm and also to pay off the debt. The adjustment for cash is to recognize that if we were a buyer the cash could be used immediately to buy back debt or pay a dividend. Thus, you can think of enterprise value as another measure of liquidity of a company. It is not only important to individual investors, but also institutional investors.