Question

Which receipts are called as capital receipts? (Answer in one sentence)

Answer 1

Government receipt which either Create or reduce assets are called capital receipt

Answer 2

Answer:

Capital Receipts are those receipts which are listed on the liabilities side of a balance sheet and generally tend to be long-term receipts intended for investment.

Explanation:

Capital Receipts: These are listed on the liabilities side of a balance sheet and generally tend to be long-term receipts intended for investment. Below are a few examples:

• Sale of shares and debentures
• Capital received from owner
• Sale of old assets

Capital receipts are from the income generated from investment in business and which are not related to operation of the business and so have no effect on profit or loss of business but affect assets and liabilities i.e. affect Balance Sheet.