In accounting, capital refers to the value of the investment in a business by the owner(s) . It is the part of the business that belongs to the owner and is often described as the owners interest. Capital can refer to several elements of a business, including financial assets, capital assets, and cash flow. Financial assets are the funds that a company has access to and are commonly used to help the company deal with expenditures. Capital assets refer to a companys manufacturing equipment, physical facilities, and assets held to generate capital, such as real estate and inventory. In the accounting sense, capital typically relates to cash flow. Capital is crucial in business, and many companies have various capital structures, including working, trading, and equity capital. Without capital, a business would struggle to carry out its day-to-day operations, and as the business grows, it requires more capital. Companies need to manage how they invest in their capital carefully if they hope to achieve a return on investment.