Is Capital Asset is different from Business Assets?

Mr.Romik Gangwal

I understand your question as under:

Business Assets and

Capital Assets (Capital Assets acquired for personal purpose which are not considered as business assets and these assets are not employed in the business of the person who acquired them)

example:

A person is carrying on real estate business.  He purchase and sells plots of land. He has purchased a particular plot of land and he has kept it for his personal purpose.  He has not shown that particular plot of land in his stock.  Thus the particular land has not been reflected in the business assets of the person.

If that person maintains seperate books of account for personal purpose he shows the particular land as an asset in his personal books of account.

If that person does not maintain person books of account at the purchase of plot of land he debits his capital account.

When ever he sells that personal capital assets the result of the sale will be either credited or debited as the case may be to the capital account of that person.

I hope that I could clarify your doubt..

Best Wishes

Sathikonda