States Component of operating surplus
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Yogita Ingle 6 years, 6 months ago
Operating surplus is a component of calculating national income by Income Method, it refers to income earned by owners of property and enterprise. It is classified into following categories:
1) Rent it is income earned from property.
2) Royalty: it is income earned from property.
3) Interest: it is income earned from property.
4) Profit: it is income earned from entrepreneurship.
Profit includes:
i) Dividend: it is part of profit that is distributed to shareholders.
ii) Corporate tax: it is part of profit that is paid to government in form of tax.
iii) Undistributed profit: it is part of profit that is retained for future use.
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