What is meant by deferred revenue

Assignment Help Finance Basics

Reference no: EM131421323

When Microsoft Corporation released earnings for its third quarter of fiscal 2007, profits hit a record $4.9 billion, driven in large part by revenue that was 32 percent higher than the previous year. However, the $14.4 billion in sales included $1.67 billion in deferred revenue from the redemption of upgrade coupons for the company's recently released operating system, Vista, that were never used. The coupons for Vista upgrades were given to customers prior to the release of the new program. REQUIRED:

a. What is meant by "deferred revenue" and where does it fit in the financial statements?

b. Discuss the cash flow implications of the $1.67 billion in deferred revenue for Microsoft in the current and past fiscal quarters.

c. How do you think an analyst following the company would react to the above earnings announcement? How would the deferred revenues factor into the analysis?.

Reference no: EM131421323

Questions Cloud

Would pearsons r be positive or negative : This spreadsheet contains the data from a study that attempted to see if there is a correlation between the hours that students studied and the grade that they earned on a test. The correlation test you are about to run will help you to determine ..

Boiling water at atm pressure : 1. An iron vat is 11 m long at room temperature (20°C). How much longer is it when it contains boiling water at 1 atm pressure? 2. An aluminum wing on a passenger jet is 40 m long when its temperature is 21°C.At what temperature would the wing be 2..

Employability for languages : Is it peer reviewed? No, it's not - Is it available in full text? Yes, it is and Implication of the paragraph/relevance to your topic

Different wing configurations were analyzed during this lab : Explain Three different wing configurations were analyzed during this lab. The first one was of a simple wing of NACA 2415 airfoil. The second one was the same airfoil with flaps added, and the third one had flaps and slats.

What is meant by deferred revenue : How do you think an analyst following the company would react to the above earnings announcement? How would the deferred revenues factor into the analysis?.

What color is used to represent the proton : What color is used to represent the proton (hydrogen nucleus)? What does the blue squiggle represent? What atomic nucleus is created in the collision?

Resultant velocity of the airplane : An airplane flies at 200 km/h at 30.0o N of W. The wind blows it at 30 km/h at 45.0o E of N. What is the resultant velocity of the airplane (magnitude and direction)

Energy density between the plates : Find the acceleration of a proton released from a point near the positive plate of a charged capacitor with an energy density between the plates of 1.25 x 10^-4 j/m^3.

Expected conditions on the tailpipe downstream : The Three-Mile nuclear accident had a stuck open relief valve. Research the accident and discuss what would be the expected conditions on the tailpipe downstream of the relief valve. (Actual conditions were not what were expected.)

User Account

All Pages