real capital

Definition

Capital, such as equipment and machinery, which is used to produce goods. Real capital is distinguished from financial capital, which is funds available to acquire real capital. Real capital appears on the asset side of the balance sheet, while financial capital appears in either the liabilities section or the shareholders' equity section.

Use real capital in a sentence

You should try to make sure that you know how much real capital you have so that you are always aware.

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The real capital of the firm was substantial as they owned restaurant locations in the busiest parts of the town.

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The accountant was tasked with making sure that the company he worked for had enough real capital at the end of the calendar year.

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