Refer to Best Buy’s financial statements in Appendix A to answer the following.
1. Identify and write down the revenue recognition principle as explained in the chapter.
2. Research Best Buy’s footnotes to discover how it applies the revenue recognition principle and when it recognizes revenue. Report what you discover.
3. What is Best Buy’s profit margin for fiscal years ended March 1, 2008, and February 28, 2009?
4. For the fiscal year ended February 28, 2009, what amount is credited to Income Summary to summarize its revenues earned?
5. For the fiscal year ended February 28, 2009, what amount is debited to Income Summary to summarize its expenses incurred?
6. For the fiscal year ended February 28, 2009, what is the balance of its Income Summary account before it is closed?