- 1. In accounting, it is where costs to acquire an asset are included in the price of the asset.
2. The sum of a corporation's stock, long-term debt and retained earnings. Also known as "invested capital".
3. A company's outstanding shares multiplied by its share price, better known as "market capitalization".
1. For example, if a machine has a price of $1 million this value would be recorded in the assets, if there was also a $20,000 charge for shipping the machine then this cost would be capitalized and included in assets.
2. The capitalization of a firm can be overcapitalized and undercapitalized, both of which are potential negatives.
3. If a company has 1,000,000 shares and is currently trading at $10 a share, their market capitalization is $10,000,000.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
capitalization — cap·i·tal·i·za·tion /ˌka pət əl ə zā shən, əl ī / n 1: the act or process of capitalizing capitalization of earnings 2: a sum resulting from a process of capitalizing; esp: paid in capital at capital ina … Law dictionary
Capitalization — Cap i*tal*i*za tion, n. 1. The act or process of capitalizing. [1913 Webster] … The Collaborative International Dictionary of English
capitalization — 1860, act of converting (assets) to capital, noun of action from CAPITALIZE (Cf. capitalize) in the financial sense. Meaning act of writing or printing in capital letters is recorded from 1864 … Etymology dictionary
capitalization — (Amer.) capÂ·iÂ·talÂ·iÂ·zaÂ·tion || â€škÃ¦pÉªtÉ™laÉª zeÉªÊƒn n. act or process or capitalizing (also capitalisation) … English contemporary dictionary
capitalization — [kap′ət l ə zā′shən] n. 1. a) the act or process of converting something into capital b) the amount or sum resulting from this 2. the total capital funds of a corporation, represented by stocks, bonds, undivided profit, surplus, etc. 3. the total … English World dictionary
Capitalization — This article is about capitalization in written languages, including languages other than English. For other uses, see Capitalization (disambiguation). For capitalization guidelines on Wikipedia, see Wikipedia:Manual of Style (capital letters).… … Wikipedia
Capitalization — The debt and/or equity mix that fund a firm s assets. The New York Times Financial Glossary * * * capitalization cap‧i‧tal‧i‧za‧tion [ˌkəptlaɪˈzeɪʆn ǁ əˈzeɪ ] also capitalisation noun [uncountable] FINANCE 1 … Financial and business terms
capitalization — (1) The process of imputing a value to an income stream by dividing the annual net income before income taxes and depreciation by a rate of return expressed as a decimal. This process is used in real estate lending and appraisals. (2) The total… … Financial and business terms
capitalization — /kaepatabzeyshan/ Capitalization represents the total amount of the various securities issued by a corporation. Capitalization may include bonds, debentures, preferred and common stock and surplus. Bonds and debentures are usually carried on the… … Black's law dictionary
capitalization — 1) The act of providing capital for a company or other organization. 2) The structure of the capital of a company or other organization, i.e. the extent to which its capital is divided into share or loan capital and the extent to which share… … Accounting dictionary