Telecommunication, Real Estate, And Software Industries

Revenue recognition is one of the top causes for financial statement restatements. In addition, revenue recognition is an area commonly questioned by the Securities and Exchange Commission (SEC) staff in their review of public filings and resultant comment letter process. Furthermore, revenue recognition is often prey to financial fraud.

3. Should the February 1, 2012, agreement and the May 1, 2012, agreement be accounted for separately or as a single arrangement?

The future of the telecommunication industry is an exciting future. No longer can these companies depend on telephone service plans to maintain profit. Each company needs to find other avenues, packages and services that can be sold to existing customers while attracting new customers. The companies

v. This is applicable to our case because the negotiation and contract signing payments can be considered arrangement considerations because the payments are fixed and therefore, should be allocated over the three

The boards proposed a standard by which revenue would be recognized entirely based on the firm’s contract with the customer. Any remaining rights or obligations in the contract would give rise to net contract assets or net contract liabilities. Under the proposal, revenue would be recognized based on the changes in rights and obligations under a contract entered into with a customer. Rights (assets) arise from a customer’s promise of cash or other compensation while obligations (liabilities) arise from the firm’s promise to transfer assets to the customer. Revenue is recognized whenever there is an increase in contractual assets or a decrease in contractual liabilities or a combination of both. Remaining rights under the contract are measured, the balance of which will create a net contract asset or a net contract liability.

1. Describe the cost behavior in the wireless industry. What are the implications of this cost behavior for cost-volume-profit (CVP) relationships?

Lopez family pay $550.00 per month for the utility.They pay $225.00 for gas/electricity ,$90 per month for water. Lopez pay the cell plan, because they wanted everyone in there house can use it. Lopez family use less cell phone in the house and the kids in the house have to share the cellphone to each other because they don't need a phone when they still young. They pay $75.00 per month for all the cells phone and they have to pay $160.00 for the bundle that include unlimited text, unlimited talking, and unlimited data for 4 phone in the family.

The upfront costs to sell ESA were difficult for customers to overcome when implementing a decision. Customers are initially shown a high price at the time of reviewing the lease and then forced to make decision. Customers are then opted to buy rather than lease. As an alternative the lease agreement could have been adjusted as Interface has no commitment in asking for a specific price amount upfront. Therefore, a smaller amount could be requested from the customer rather than two large transactions at the time of signing the lease agreement. Interface could explore other options to alleviate upfront costs by dropping specific services provided by Re: Source such as the daily tasks of vacuuming and emergency spot removals. Removing such services will allow them to charge a lower

Please keep in mind the prices for the package above does not include the additional equipment and services on the account. In addition to the package price there will be a $10.00/month modem lease, HD Technology fee of $10.00/month and the two boxes on the account are $9.95/month each.

The cost of implementation of the options: It is found in the survey that 20% customers had had repeat work. Considering 5% as redundant, the customer erosion could be as large as $4.37 million (Exhibit 2). Thus making the investment of $75000 is completely justified.

Spectrotel does not require any contracts, and it will lower our rates of our phone bills. Our average monthly bill is around $115 a month per store. We negotiated with Spectrotel down to around $50 a month plus local taxes for monthly phone bill. This means more money in your pockets. We have managed to convert over

active in France since 1999.” (Marketline, 2012). By offering mobile phone service at a lower

Without real numbers to use, we can only estimate what the first pricing option will look like. The industry norms right now are $52 for 417 minutes. It is expected that the youth market will average the same usage as the adult market. They will use the phones both during business hours (while at school) and in the evenings, so the usage pattern may not differ that much. The contribution to fixed costs, based on service cost of $30, in $22 per customer. The fixed costs are the $60 million in advertising, and other unspecified costs. It will be assumed that the advertising is the only incremental fixed cost to this decision. The breakeven point would be $60 million / $22 = 2,727,273 customers. This would Virgin into the #8 market position, a goal that is not at all unattainable. Cellular penetration of the US market in the 15-19 age group is only around 16%,

Prestige Telephone Company Average intercompany billing capped at $82,000/month Ri = Pi Qi “Inter company” Pi = $400/hr. → Qi = 205 hours/month “Commercial” PC = $800/hr

Subscription-based mobile phone contracts are one the areas which have driven the mobile phone markets in developed countries but not in Indonesia. Despite the penetration being at 62.7%, it has been largely dominated by the pre-paid networks that consist of a massive 95% of the market share which also directs that the customers follow the 'Pay-as-you-go ' agenda.