Capital Surplus

DEFINITION of 'Capital Surplus'

Equity which cannot otherwise be classified as capital stock or retained earnings. It's usually created from a stock issued at a premium over par value.

BREAKING DOWN 'Capital Surplus'

Capital surplus is also known as share premium (UK), acquired surplus, donated surplus, paid-in surplus, or additional paid-in capital.

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RELATED FAQS
  1. What business risks ultimately caused Enron's collapse?

    The Internal Revenue Service (IRS) requires that a company lists its share premium – otherwise known as the capital surplus ... Read Full Answer >>
  2. What sectors are best for an investor seeking a high annual return?

    A company receives a share premium whenever it receives money in excess of the face value (par value) of its shares. Corporations ... Read Full Answer >>
  3. How does goodwill increase a company's value?

    Business goodwill is an intangible asset owned by and associated with the operation of the company. The goodwill of a company ... Read Full Answer >>
  4. What items are considered liquid assets?

    A liquid asset is cash on hand or an asset that can be readily converted to cash. An asset that can readily be converted ... Read Full Answer >>
  5. What is the formula for calculating EBITDA?

    When analyzing financial fitness, corporate accountants and investors alike closely examine a company's financial statements ... Read Full Answer >>
  6. What is the formula for calculating the debt-to-equity ratio?

    Expressed as a percentage, the debt-to-equity ratio shows the proportion of equity and debt a firm is using to finance its ... Read Full Answer >>
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