CAPITAL ITEM Meaning and
Definition
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A capital item refers to a significant asset that a business owns or a long-term investment made by an individual or entity. It typically includes high-value items that are used to generate income over an extended period. Capital items are also known as capital assets or fixed assets.
In terms of business, a capital item can encompass various assets such as machinery, equipment, land, buildings, vehicles, or even patents and copyrights. These items are typically not intended for immediate sale but are instead utilized in the production or provision of goods and services. For instance, a manufacturing company may consider its production equipment as capital items, as they are essential for the core operations and revenue generation.
Similarly, in personal finance, capital items generally refer to significant investments made by individuals, like a house, valuable artwork, or a piece of land. These items are considered long-term assets that can appreciate in value or serve a particular purpose in the owner's long-term financial strategy.
The classification of an item as a capital item is typically based on its cost and expected useful lifespan. Usually, capital items are recorded on a balance sheet and depreciated over time to reflect their diminishing value and wear and tear. They are subjected to different accounting treatment compared to regular expenses, as they are expected to contribute to revenue generation and provide long-term benefits for the business or individual.
Common Misspellings for CAPITAL ITEM
- xapital item
- vapital item
- fapital item
- dapital item
- czpital item
- cspital item
- cwpital item
- cqpital item
- caoital item
- calital item
- ca-ital item
- ca0ital item
- caputal item
- capjtal item
- capktal item
- capotal item
- cap9tal item
- cap8tal item
- capiral item
- capifal item
Etymology of CAPITAL ITEM
The term "capital item" does not have a specific etymology as it is a combination of two individual words.
1. Capital: The word "capital" comes from the Latin word "caput", which means "head". It originally referred to the top or head of something, and it gradually acquired various financial and economic connotations. In the context of finance and accounting, "capital" refers to financial assets or wealth that is used in the production of further assets.
2. Item: The word "item" has a slightly more complex etymology. It comes from the Latin word "item", which originally meant "also" or "likewise". Over time, it evolved to be used as a noun to refer to a distinct or separate thing. In accounting, an "item" refers to an individual entry or component in a financial statement or inventory list.
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