Financial Accounting and Reporting Case: America Online 1. What accounting approach has AOL used in the past that it is now changing (related to the $385 million)? AOL‚ prior to October 1‚ 1996‚ recorded the expenditure related to subscribers acquisitions as an asset and amortized monthly over a period < 24 months. This was a strongly criticized approach. Furthermore‚ the accounting approach in the article is considered aggressive. In October 1996‚ they discontinued capitalizing customer acquisition
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Using the Accounting Framework: AOL (Chapter 5‚ Antle) • AOL’s business environment America Online was the leader in providing internet connections in 1997 with 8.6 million subscribers. AOL had two sources of revenue (i) online service revenue generated from customer subscription to online service‚ and (ii) other revenues from e-commerce and advertising. Rapid changes occurred in the manner in which subscription revenue was generated which shifted AOL strategy to focusing on increasing
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Chapter 2 America Online‚ Inc. Teaching Note Introduction The America Online (AOL) case is a comprehensive financial-statement analysis case. It enables students to do strategic analysis‚ accounting analysis‚ financial analysis a: and prospective analysis in a rich context. It can he used either as the first case in a course. on financial; statement analysis to set up the course framework or towards the end of the course as a comprehensive case. If it is used at the beginning‚ the instructor should
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AOL Case Study 1. What accounting approach has AOL used in the past that it is now changing (related to the $385 million)? Prior to October 1‚ 1996‚ AOL accounted for the cost of direct response advertising as "Deferred Subscriber Acquisition Costs‚" i.e.‚ it recognized (reported) the costs of mailing out diskettes allowing you to sign-on to AOL for 100 free minutes as an asset on its Balance Sheet. In accounting‚ we say that the costs were "capitalized‚" meaning reported on the Balance Sheet
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1. In the AOL / Time Warner transaction‚ which party was the acquirer? It was structured as a MOE (Merger of Equals). However‚ after the transaction‚ the previous AOL shareholders owned 55% of the new company (“New Co”) so the industry analyst commented that AOL acquired Time Warner. However‚ the deal process (due diligence‚ merger agreement‚ and the final negotiation) and the aftermath and the senior management composition suggests that actual buyer seems be Time Warner. 2. What were the three
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and access to better educational opportunities. This group was successful because they knew that the way and possibly only way they would be able to get these things that they wished for would to have political power. The Chicano Movement was successful because of important people that made it successful that empowered other Chicanos to
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------------------------------------------------- Why “JD” is so successful in its marketing? If we focus on the needs of consumers‚ an organization creates a business that can outclass its competitors. The goal is also being closer to consumers and providing exactly what they want‚ for at last‚ trigger their purchase. This kind of business carries out research to find the needs and wants of consumers. It then uses the findings to design products and marketing strategies to satisfy these needs
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exterior of this gigantic operation. The future also looks bright for Wal-Mart‚ especially if it is able to strike a comfortable balance between increasing its profits and recognizing its social and ethical responsibilities. <br> <br>Why is Wal-Mart so Successful? Is it Good Strategy or Good Strategy Implementation? -- In 1962‚ when Sam Walton opened the first Wal-Mart store in Rogers‚ Arkansas‚ no one could have ever predicted the enormous success this small-town merchant would have. Sam Walton’s talent
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Steps to make Online Business Successful This essay shows you how to run successful business – getting more visitors and making more profit. Through five chapters you’ll learn to build solid foundations for your business‚ make user friendly web site‚ market your business‚ make surfers find you through search engines‚ use most effective way of marketing and to promote your business on different channels. Market analysis – before jumping into some business it is necessary to check out the market
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MIS Management Information System Crowdsourcing at AOL Case Analysis 1. A brief analysis of the case study AOL engaged in what is called “micro-tasking”‚ and is believed to revolutionize the virtual workforce. Micro-tasking is what Daniel Maloney‚ an AOL executive‚ applied when he was faced with inventorying a vast video library. He broke the large job into small pieces and utilized a crowdsourcing IT platform‚ Mechanical Turk‚ in order to describe each task that he required to be done. Each
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