Definition: Acquisition cost (Historical Cost Value - HCV)
Capital goods are valued at their ("historical cost value" or HCV) prices prevailing at the time the goods were purchased. The gross capital stock represents the sum of financial capital invested into the capital goods at the time of purchase. The net capital stock is the amount of capital fixed in the capital goods. It is equal to the accumulated expenditure on investment less the return of depreciation by cash flow. This valuation is close to the valuation of assets in commercial balance sheets and can therefore be used as a financial indicator.
For the calculation of capital stocks at acquisition cost, it is important to include purchase of used capital goods in the investment series. This guarantees that the investment of new owners (purchase price less depreciated value) is counted as an additional investment (if the difference is positive). If only the purchase of new capital goods were counted the amount of hidden values would increase.
The capital stock in the European Union - Structural diagnosis and analytical aspects, Eurostat 1997