Physical capital

Real capital describes the totality of all means of production of a company, i.e. material goods. Real capital consists of plants, machines, buildings and land that are used for production. In the corporate cycle, money capital is often converted into physical capital and, in addition to work, these physical goods are also used in the production process.

In every balance sheet and every annual financial statement, the items credit and monetary capital as well as physical capital are juxtaposed. The real capital can be found on the assets side.

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