Definition
Gloss Paid-in and Contributed Surplus refers to the amount of capital a company receives from investors that is above and beyond the par value of the stock that is issued. This financial metric is essential in understanding how companies are funded and how they manage excess capital from share issuance.
Key Points
Par Value: The nominal or face value of a stock or bond as stated by the issuer.
Excess Capital: Any amount received over the par value during the issuance of new shares.
Importance
In corporate finance, discerning the differences in capital composition is crucial for understanding a company’s financial health and investment potential. Gross Paid-in and Contributed Surplus helps investors gauge how much additional investment a company attracted during its capital-raising exercises.
This parameter contributes to the company’s equity and can affect how dividends are paid out or how capital is allocated for corporate growth.
For further learning about dividends and equity, you may visit resources such as the Securities and Exchange Commission (SEC) or consult the relevant sections in the Investment Company Act of 1940 and associated regulations.
