Capitalized


Also found in: Dictionary, Thesaurus, Legal, Idioms, Encyclopedia.

Capitalized

Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year.

Capitalize

In accounting, to recognize expenses on long-term liabilities over a long period of time. This allows a company to spread out its expenses so they do not appear to reduce profits at any particular time. For example, a company may have a $1 million profit and a $1 million loan to acquire machinery for its factory. If it does not capitalize the loan, its balance sheet will show no profit for that year. Capitalizing the loan allows the company to recognize the liability over a certain period, usually the usable life of the machinery.
References in periodicals archive ?
41) A cost not capitalized under the INDOPCO regulations still may be subject to capitalization under section 263A.
38,750,000 class K twelfth priority floating rate capitalized interest term notes 'B'.
20,187,500 class H floating rate capitalized interest notes due 2042 'BBB';
If separately stated, the treatment of a fairness opinion fee is relatively straightforward--it is capitalized in its entirety as an inherently facilitative cost if the transaction is ultimately consummated.
4) The advertising ruling reads in part: "Only in the unusual circumstances where advertising is directed towards obtaining future benefits significantly beyond those traditionally associated with ordinary product advertising or with institutional or goodwill advertising, must the costs of that advertising be capitalized.
To the extent T realizes a loss on the put option, it is capitalized into the basis of the X shares that T identified.
Indeed, the Bulletin clearly distinguishes installation costs, which are capitalized to replacement assets, from removal costs, which relate economically to the asset disposed.
Just over 89% of Florida banks were Well Capitalized or Adequately Capitalized two years ago.
As in the proposed regulations, the satisfaction presumption is not available to a disregarded entity, but may be available to a thinly capitalized entity regarded as a partner for Federal tax purposes.
As under the current regulations, costs incurred to acquire or produce real or tangible personal property having a useful life substantially beyond the end of the taxable year must be capitalized.
Specifically, immaterial leases should not be capitalized.
The difference between the carrying amount of a policy (acquisition cost plus capitalized premiums plus income recognized) and its face value is recognized as income ratably over the insured's life expectancy.