In the national accounts, gross operating surplus (GOS) is the portion of income derived from production by incorporated enterprises that is earned by the capital factor. It is calculated as a balancing item in the generation of income account of the national accounts.
It differs from profits shown in company accounts for several reasons. Only a subset of total costs are subtracted from gross output to calculate the GOS. Essentially GOS is gross output less the cost of intermediate goods and services (to give gross value added), and less compensation of employees. It is gross because it makes no allowance for depreciation of capital.
A similar concept for unincorporated enterprises (e.g. small family businesses like farms and retail shops or self-employed taxi drivers, lawyers and health professionals) is gross mixed income. Since in most such cases it is difficult to distinguish between income from labour and income from capital, the balancing item in the generation of income account is "mixed" by including both, the remuneration of the capital and labour (of the family members and self-employed) used in production.
Gross operating surplus and gross mixed income are used to calculate GDP using the income method.
Read more about Gross Operating Surplus: Data
Famous quotes containing the words gross, operating and/or surplus:
“We are ashamed to seem evasive in the presence of a straightforward man, cowardly in the presence of a brave one, gross in the eyes of a refined one, and so on. We always imagine, and in imagining share, the judgments of the other mind.”
—Charles Horton Cooley (1864–1929)
“Many people operate under the assumption that since parenting is a natural adult function, we should instinctively know how to do it—and do it well. The truth is, effective parenting requires study and practice like any other skilled profession. Who would even consider turning an untrained surgeon loose in an operating room? Yet we “operate” on our children every day.”
—Louise Hart (20th century)
“Dog. A kind of additional or subsidiary Deity designed to catch the overflow and surplus of the world’s worship.”
—Ambrose Bierce (1842–1914)