Contributed Surplus

What is 'Contributed Surplus'

Contributed surplus is the amount of money that a company earns from sources other than its profits, such as when a company issues and sells shares at a price greater than their par value. The contributed surplus figure helps both investors and the company to distinguish between non-operational and operational income. It is found within the balance sheet.

BREAKING DOWN 'Contributed Surplus'

If this value was combined with operational earnings, investors would have a hard time forecasting relatively accurate future earnings because earnings from contributed surplus are not a part of ongoing business operations.

RELATED TERMS
  1. Surplus

    The amount of an asset or resource that exceeds the portion that ...
  2. Benchmark Surplus

    Benchmark surplus is an insurance term that refers to the amount ...
  3. Adjusted Surplus

    The surplus (assets minus liabilities) of an insurance company ...
  4. Non-Operating Income

    The portion of an organization's income that is derived from ...
  5. Operating Earnings

    Profit earned after subtracting from revenues those expenses ...
  6. Contributed Capital

    An entry on the shareholders' equity section of a company's balance ...
Related Articles
  1. Investing

    Explaining Non-Operating Income

    Non-operating income is any profit or loss a business generates through activities that are not related to its core operations.
  2. Investing

    Japan’s Trade Account Surplus Narrowed in May

    Japan has been posting large account surplus for the past few months amid good yield on foreign investments and a weaker yen.
  3. Investing

    Understanding Consumer Surplus

    Consumer surplus is an economic measure of consumer satisfaction, which is calculated by analyzing the difference between what consumers are willing to pay for a good or service, relative to ...
  4. Retirement

    RRSPs: Contributing - Part 1

    Contribution Limits Because of the tax benefits provided by RRSPs, the Canadian government has capped the amount of money that can be contributed. (Note: the contribution limit is sometimes called ...
  5. Markets

    Why Would A Stock Have No Par Value?

    A stock with no par value might trade for thousands of dollars. It just depends on what the market deems it’s worth.
  6. Investing

    Cleaning Up Dirty Surplus Items On The Income Statement

    Dirty surplus items can skew net income. Knowing how to account for them will give you a cleaner picture.
  7. Markets

    What's a Producer Surplus?

    In economics, producer surplus is the difference between the price at which the producer actually sells a product and the minimum price the producer would have accepted for the product. The surplus ...
  8. Retirement

    401(k) Contribution Limits in 2016

    Find out what the contribution limits are for 401(k) retirement savings plans in 2016, including individual, employer and aggregate limits.
  9. Retirement

    Why are 401(k) contributions limited?

    Find out why contributions to 401(k) retirement plans are limited, including what the current contribution limits are and how limits encourage participation.
  10. Personal Finance

    Everything Investors Need To Know About Earnings

    We go over the concepts behind the excitement over the most important figure in the stock market.
RELATED FAQS
  1. Why are economists interested in the consumer surplus?

    Understand why an economist would be interested in consumer surplus. Learn why an economy would want to maximize consumer ... Read Answer >>
  2. Can I make a contribution to my Roth IRA before I get paid quarterly?

  3. What does it signify about a given product if the consumer surplus figure for that ...

    Find out about high consumer surplus and what it means for utility and the structure of supply and demand in the market for ... Read Answer >>
  4. What's does the current account have to do with the trade balance?

    Learn how a nation's trade balance is factored into its current account, and the differences between these two common terms. Read Answer >>
  5. Why would someone par more for a share of stock than its face value (above Par)? ...

        ... Read Answer >>
  6. Are corporations required to state the par value of their stock?

    Find out when companies are required to state the par value of stock and why it is beneficial to businesses and shareholders ... Read Answer >>
Hot Definitions
  1. Glass-Steagall Act

    An act the U.S. Congress passed in 1933 as the Banking Act, which prohibited commercial banks from participating in the investment ...
  2. Quantitative Trading

    Trading strategies based on quantitative analysis which rely on mathematical computations and number crunching to identify ...
  3. Bond Ladder

    A portfolio of fixed-income securities in which each security has a significantly different maturity date. The purpose of ...
  4. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  5. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  6. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
Trading Center