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11-07-2008 @ 12:08AM
I'm surprised to see it take the CPAs 10 entries to mention GAAP and nearly 30 to metion the matching principle. For we laymen, the GAA principles are made by a national board who has been delegated the power from either Dept of Treasury, or Securities & Exchange. Matching has been explained above, but I'll give an example, periodical subscription income.If you send off $24 to ZINE magazine, you will get 2 years of monthly issues. If the publisher recognized all of your money at the beginning, they'd have one big revenue month, and 23 loss months (printing, postage, lights n heat, and all that). So they set it up to have $1 month income against each monthly issue. If you are a Time-Warner or Tribune stockholder, you'll see something a tad more complicated in your annual report.Activision-Blizz-Vivendi-whoever is doing the same thing with their CD. Your $70 collector edition might break down to $15 for Blizz, $20 for the distributor, and $35 for the retailer (I'm totally making these numbers up). If Blizz estimates a 2 and a half year customer life, that's 50 cents per month for mine, pluse the $14.95 subscription. Multiply by however many millions you want.Although a lot of the cost of the DVD is up front (coding, testing, pressing, marketing, shipping) there are aftersale costs such as support and upgrading. I've just come off an 18 month temp job testing new firmware releases for a GPS manufacturer. If you see the build numbers jump quite a bit, that's because the ones you didn't see had major bugs. Some folk in Irvine are coding and testing. Some of this expense will be linked back to BC, some (esp for v3.x) will be costed to WotLK.Shameless plug: 25-year bookkeeper (and 3 year WoW fan)wants work in Western Riverside or San Bernardino counties, CA. E-mail firstname.lastname@example.org
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