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Cost Allocation and Revenue Recognition at Facebook Values: Total Costs: $80,000,000 Revenue Earned: $120,000,000 Number of Users: 1,000,000,000 Cost Allocation Bases: Active Users, Revenue Requirements:
Cost Allocation and Revenue Recognition at Facebook
- Values:
- Total Costs: $80,000,000
- Revenue Earned: $120,000,000
- Number of Users: 1,000,000,000
- Cost Allocation Bases: Active Users, Revenue
- Requirements:
- Allocate costs using active users as the allocation base for Facebook.
- Allocate costs using revenue as the allocation base for Facebook.
- Discuss the impact of cost allocation methods on financial reporting.
- Analyze how revenue recognition principles apply to Facebookâs business model.
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