capital asset Also found in: Legal, Financial, Wikipedia. Related to capital asset: Capital asset pricing model capital asset n. A long-term asset, such as land or a building. American Heritage® Dictionary of the English Language, Fifth Edition. Copyright © 2016 by Houghton Mifflin ...
Section 1221 of the tax code broadly defines a capital asset. Over time the courts have attempted to narrow that definition and eliminate confusion. Recently a Third Circuit Court of Appeals ruling brought further clarification. In June 1991 George and Angeline Lattera purchased a Pennsylvania ...
How Does a Capital Asset Work? Capital assets usually include buildings, land, and major equipment. For example, Company XYZ might own a factory building on three acres of land, and the factory might be full of expensive equipment. The building, the land, and the equipment are all usually ...
a. assets remaining after deduction of liabilities; the net worth of a business. b. the ownership interest in a business. 6. any source of profit, advantage, power, etc.; asset. adj. 7. pertaining to financial capital. 8. principal; primary: a subject of capital concern. 9. ch...
assets remaining after deduction of liabilities; the net worth of a business. the ownership interest in a business. any source of profit, advantage, power, etc.; an asset or assets (usually used in combination): He has the political capital to push through the legislation. ...
Define Capital Expenditure:CAPEX means the purchase of a fixed asset that has a useful life of more than one year. Shaun Conrad, CPA Accounting & CPA Exam Expert Shaun Conrad is a Certified Public Accountant and CPA exam expert with a passion for teaching. After almost a decade of experience...
— capital asset : a tangible or intangible long-term asset especially that is not regularly bought or sold as part of the owner's business specifically : any asset classified as a capital asset by law (as section 1221 of the Internal Revenue Code) — current asset : a short-term ...
Assets arean important component of the accounting equationbecause they structure a balance sheet: Assets = Liabilities + Capital Liabilities = Assets – Capital Capital = Assets – Liabilities Etymology of ‘asset’ Etymology means the study of the history of words and how they have evolved. Etym...
The capital asset pricing model, or CAPM, is a financial model that calculates the expected rate of return for an asset or investment. CAPM does this by using the expected return on both the market and a risk-free asset, and the asset’s correlation or sensitivity to the market (beta)....
A capital gain refers to the increase in the value of acapital assetwhen it is sold. It occurs when you sell an asset for more than what you originally paid for it. Almost any type of asset you own is a capital asset. This can include a type of investment (like a stock, bond, or...