Skc. 6] CAPITAL 63 
in a joint stock company, it consists of the total sum of the contribu- 
tions of the shareholders. b. Pol. Econ. The accumulated wealth of 
an individual, company, or community, used as a fund for carrying 
on fresh production; wealth in any form used to help in producing 
more wealth. 
In business manuals and articles on practical account- 
ing we find that capital is employed in the sense of the 
net value of a man’s wealth. Thus L. W. Lafrentz, speak- 
ing of the difference between assets and liabilities," states: 
“The residue will be the net worth of the proprietor — 
the capital of the proprietor.” 
Inquiry among business men also reveals the fact that 
in business usage all wealth is included in the term “capital.” 
It would astonish a business man to have an economist 
strike out from his assets as non-capital his raw materials, 
as would Kleinwiichter; his perishable goods, as would 
Hermann; his fuel, as would Walras; or, above all, his 
land, as would most of the classical economists. That land 
is capital, business men all emphatically declare. As the 
manufacturer would express it, land is the very first thing 
into which the “paid-in” capital of a new concern is con- 
verted. Again, business men maintain that the junction 
of any given wealth has nothing to do with its classification 
as capital. It need not be “for production” nor “for sus- 
taining laborers,” nor for any particular object whatever. 
The only point on which some of them hesitate is whether 
or not all articles in consumers’ hands are capital. The 
reason for this hesitation may possibly be found in the cus- 
toms of bookkeeping. As one business man expressed it, 
“Capital is simply a bookkeeping term.” Consequently 
the business man naturally associates the term with his 
shop and not his home, for he keeps a balance sheet in the 
former and not in the latter ; but, once given a balance sheet, 
14 Beonomic Aspects of Accounting and Auditing,” Journal of 
Accountancy, April, 1906, p. 482. Cf. Victor Branford, Economics and 
Accountancy, London (Gee & Co.), 1901, and Charles E. Sprague, The 
Accountancy of Investment, New York (Business Publishing Co.), 1904, 
p. 12.