Under Merton's framework, the market value of the firm’s underlying assets follows the following stochastic process:
dV(A) =μ V(A) dt+σ(A) V(A) dz
where
V(A) ,dV(A) are the firm’s asset value and change in asset value,
μ ,σ(A) are the firm’s asset value drift rate and volatility, and
dz is a Wiener process.
The BS model allows only two types of liabilities, a single class of debt and a single class of equity, so
V(D) = V(A) - V(E)
If X is the book value of the debt which is due at time T then the market value of equity and the market value of assets are related by the
following expression:
V(E)=V(A)*N( d1) −exp(−rT)* X*N( d2)
V(E) is the market value of the firm’s equity,
d1 is similar to that in B-S,
d2=d1−σ(A)* T^(1/2) , and
r is the risk free interest rate.
From above equations, you can see the relationship between variables in your question.