Surplus

what is surplus

The surplus, in economics, refers to the excess income in relation to expenditures or expenses in a State, company or organization, during a given period of time. The word comes from the Latin surpluswhich means ‘left over’.

In this sense, the surplus is the positive difference that is registered between what one has and what one owes. It is the opposite of deficit.

Likewise, we speak of surplus in a general way in reference to the abundance or excess of something that is considered useful or necessary. For example: “In this company there is a surplus of talents”.

trade surplus

The trade surplus is the positive difference between what a country sells to its foreign trading partners as exports, and what it buys from other countries as imports.

As such, it occurs when the balance of the trade balance is positive, that is, when the total number of exports made by a country is greater than the volume of its imports. A trade surplus is considered beneficial to a country’s economy. It is the opposite of the trade deficit.

See also trade balance.

capital surplus

As capital surplus is called the set of equity increases that are unrelated to the corporate purpose of the entity, company or company, and that, however, effectively increase its equity.

In this sense, the capital surplus is that account where the increase in equity is recorded whose origin is different from the ordinary operations of the company and the profits produced by it, as well as the increase in investment or capital injections.

See also Capital.

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fiscal surplus

The fiscal surplus occurs when income is greater than expenditure in public administration during a given period of time.

In this sense, when a public administration is capable of raising enough money to meet State expenses and, in addition, has a surplus, this is a sign of the positive state of the country’s public finances. A fiscal surplus can lead to a budget surplus.

budget surplus

The budget surplus is the situation in which the income expected by the public administration in the State budget is higher than the ordinary expenses expected for a given budget period.

In this sense, it is associated with the fiscal surplus obtained by a State to make the budgets of the following period. The fiscal surplus that has been budgeted, then, is the budget surplus. It is the opposite of the budget deficit.

See also Budget.

Difference Between Surplus and Deficit

Surplus and deficit are antonyms. The surplus is the positive difference that is recorded in the comparison between the expenses and the income of a State, company or individual, when the income exceeds the expenses. The deficit, on the other hand, refers to the negative balance between income and expenses, when the latter are higher than the former.

A typical example is that of the trade balance of a country in which the total volume of exports exceeds that of imports, in which case a surplus is recorded. In the opposite case, that is, when imports exceed exports, there will be a deficit in the trade balance.

See also deficit.