...What is meant by sales promotion? Describe briefly the various methods of sales promotional tools used by business organizations to boost the sales. Explain any four methods of sales promotion? Sales promotion refers to activities or inducements meant to make people come and buy more of your product, especially in the short term. Sales promotion consists of short term incentives to encourage the purchase or sales of a product or service thus offering reasons to buy product or services now. Using different methods of promotion such as; giving away coupons, offering discounts, cash refunds, patronage rewards and samples makes customers decide to buy now. Sales promotion is targeted for business and industrial goods also Industrial products differ with that of consumer goods. The tools which are used are- 1) Trade shows:- The industrial products are displayed and demonstrated to the members of trade and industry. The representatives explain about the products. The trade shows can be useful for smaller firms which can’t much in advertising and also salesman can make for more contacts. Trade shows are important rules for reaching potential wholesalers & distributers for a company’s brand. 2) Business gifts:- These gifts are given as a part of building and maintaining a close working relationship with suppliers business gifts may include small items of jewellary, watch, electronic items, expensive trips. 3) Trial offers:- Trial offers are particularly well suited to...
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...selling: a study of historic and contemporary sales methods and attitudes’ Name: Arun Sehgal Student Number: P11271202 Tutor Marking: Edwina Goodwin CRITERIA | COMMENTS | MARK | Introduction/Conclusion..5% | | | Depth and Range of academic research, and evidence of understanding 25% | | | Quality of examples both historic and contemporary25% | | | Quality of individual analytical discussion- convincing? 25% | | | Correct format as outlined in module guide; adequate & correct referencing, free from errors…………………….10% | | | Reflection… …10% | | | LESS 5% IF NO CRITERIA SHEET TOTAL MARKS | | Assignment 1 Title: ‘The Evolution of selling: a study of historic and contemporary sales methods and attitudes’ Tutorial Day: Wednesday – 12 to 1 Full Name: Arun Kumar Sehgal Student ID: P11271202 Module Name: The Creative art of selling and negotiation – ENTE 2534 In the last two century professional selling has evolved dramatically through various methodologies, practices and models that have been created in order to show the old and new ways of adaptive selling. Selling models have been made in order to show the complexity of selling techniques determining the outcome of a salespersons approach to a client, making sure that previous mistakes are not repeated. Key impacts and changes happened throughout the industrial revolution and 19th century. Customer and sales professional had changed their behavioural...
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...(15-20 minutes) (a) Huish could recognize revenue at the point of sale based upon the time of shipment because the books are sold f.o.b. shipping point. Because of the return policy one might argue in favor of the cash collection basis. Because the returns can be estimated, one could argue for shipping point less estimated returns. (b) Based on the available information and lack of any information indicating that any of the criteria in FASB Statement No. 48 were not met, the correct treatment is to report revenue at the time of shipment as the gross amount less the 12% normal return factor. This is supported by the legal test of transfer of title and the criteria in FASB No. 48. One could be very conservative and use the 30% maximum return allowance. (c) July Sale Entry. Accounts Receivable 16,000,000 Allowance for Returns 1,920,000 ($16,000,000 X 12%) Sales Revenue—Texts 14,080,000 (d) October Collection. Cash 14,000,000 Sales Revenue—Texts* 80,000 Allowance for Returns 1,920,000 Accounts Receivable 16,000,000 *A debit to either Sales Revenue—Texts or Sales Returns could be made here. EXERCISE 18-2 (15-20 minutes) (a) 1. 6/3 Accounts Receivable—Kim Rhode 5,000 Sales 5,000 6/5 Sales Returns and Allowances 400 Accounts Receivable—Kim Rhode 400 6/7 Transportation-Out 24 Cash 24 6/12 Cash 4,508 Sales Discounts (2% X $4,600) 92 Accounts Receivable—Kim Rhode 4...
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...the general case. We will focus on cases where either of the two assumptions breaks down. These cases fall into two categories. In the first category, performance takes place over more than one accounting period; thus, revenue must be allocated across the periods. This is referred to as Along-term contracting@. There are two accounting methods used in this case, the percentage of completion method and the completed contract method. In the second category, cash collection is uncertain, and revenue recognition defaults to a de facto cash basis. There are also two accounting methods used in this case, the installment method and the cost recovery method. The important point to remember in each situation is that the accounting method choice affects both the B/S and the I/S, and thus any performance measures or ratios constructed from the financial statements. Thus, analysts must understand how the accounting method choice affects the reported numbers. Percentage of Completion (PCT) and Completed Contract (CC) methods These two methods are very similar, and are used mainly for construction projects that take more than one period. The methods are comprised of the same 5 journal entries. The entries (and related data) are shown in Exhibit 2.6 on page 76. Entries 1,3,4, and 5 are transaction entries that account for actual construction costs,...
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.......................................... 300,000 Sales revenue .............................................................. 300,000 To record installment sale Cost of goods sold .......................................................... 120,000 Inventory..................................................................... 120,000 To record cost of installment sale Cash ................................................................................ Installment receivables ............................................... To record cash collection from installment sale July 1, 2014 Cash ................................................................................ Installment receivables ............................................... To record cash collection from installment sale 75,000 75,000 75,000 75,000 Solutions Manual, Vol.1, Chapter 5 © The McGraw-Hill Companies, Inc., 2013 5–1 Exercise 5–6 (continued) Requirement 2 July 1, 2013 Installment receivables ................................................... 300,000 Inventory ..................................................................... 120,000 Deferred gross profit ................................................... 180,000 To record installment sale Cash ................................................................................. Installment receivables ............................................... To record cash collection from installment sale Deferred gross profit ............................
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...percentage-of-completion method. T 7. Input measure for contract progress. T 8. Reporting Construction in Process and Billings on Construction in Process. F 9. Construction in Process account balance. F 10. Recognition of revenue under completed-contract method. T 11. Principal advantage of completed-contract method. F 12. Recognizing loss on an unprofitable contract. F 13. Recognizing current period loss on a profitable contract. T 14. Recognizing revenue under completion-of-production basis. F 15. Recording a loss on an unprofitable contract. F 16. Deferring revenue under installment-sales method. T 17. Deferring gross profit under installment-sales method. T 18. Classification of deferred gross profit. F 19. Recognizing revenue under cost-recovery method. T 20. Recognizing profit under cost-recovery method. Multiple Choice—Conceptual Answer No. Description c 21. Revenue recognition principle. b 22. Definition of "realized." a 23. Definition of "earned." b S24. Revenue recognition representations. d P25. Definition of recognition. b P26. Revenue recognition principle. d 27. Recognizing revenue at point of sale. d 28. Recording sales when right of return exists. c 29. Revenue recognition when right of return exists. d 30. Revenue recognition when right of return exists. b 31. Appropriate accounting method for long-term contracts. c 32. Percentage-of-completion method. b 33. Percentage-of-completion method. c 34. Classification...
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...Questions: Circle True or False. 1. Revenue is not recognized under the realization principle unless the earnings process is complete or virtually complete and there is reasonable certainty about collectability of the asset received. True False 2. Use of the installment sales method indicates little uncertainty about collection of the receivable. True False 3. Over the life of a particular account receivable, the same total amount of gross profit is recognized under the installment method and the cost recovery method. True False 4. When the right of return exists, revenue can be recognized at the point of sale if the seller can make reliable estimates of future returns. True False 5. Under the percentage-of-completion method, amounts billed and the cash actually received affect income recognition. True False 6. Under the percentage-of-completion method, the percent complete is often estimated by comparing the cost incurred to date with the total estimated cost to complete. True False 7. Under the completed contract method, gross profit or loss is never recognized until the contract is completed. True False 8. Under the cost recovery method used to account for long-term contracts under IFRS, equal amounts of revenue and cost are recognized until all costs are recovered. True False 9. Recognition of franchise fee revenue is dependent on judgments of both substantial performance and fee collectability. True False ...
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...significant variety of marketing methods for products and services make it difficult to apply the rules consistently in all situations. Chapter 7 is devoted to a discussion and illustration of revenue transactions that result from the sale of products and the rendering of services. Throughout the discussion, attention is focused on the theory behind the accounting methods used to recognize revenue. Revenue transactions that result from leasing and the sale of assets other than inventory are discussed in other sections of the text. *Note: All asterisked (*) items relate to material contained in the Appendix to the chapter. Revenue Recognition 2. (L.O. 1) The revenue recognition principle provides that revenue is recognized when (1) it is realized or realizable, and (2) it is earned. Revenues are realized when goods and services are exchanged for cash or claims to cash (receivables). Revenues are realizable when assets received in exchange are readily convertible to known amounts of cash or claims to cash. Revenues are earned when the entity has substantially accomplished what it must do to be entitled to the benefits represented by the revenues, that is, when the earnings process is complete or virtually complete. 3. The conceptual nature of revenue as well as the basis of accounting for revenue transactions are described in the following four statements. a. Revenue from selling products is recognized at the date of sale, usually interpreted to mean the...
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...CHAPTER 5 Revenue Recognition and Profitability Analysis Part A: Introduction to Revenue Recognition I. Revenue Recognition in General A. FASB definition: “Revenues are inflows or other enhancements of assets of an entity or settlements of its liabilities (or a combination of both) from delivering or producing goods, rendering services, or other activities that constitute the entity’s ongoing major or central operations.” In other words, revenue tracks the inflow of net assets that occurs when a business provides goods or services to its customers. (T5-1) B. To determine how much revenue to recognize and when to recognize it, we apply the core revenue recognition principal: Companies recognize revenue when goods or services are transferred to customers for the amount the company expects to be entitled to receive in exchange for those goods or services. (T5-2) 1. Key concept: the seller has one or more performance obligations. a. Performance obligations are promises to transfer goods or services to the customer. b. Revenue recognition is tied to satisfaction of performance obligations. C. Five steps are used to apply the principle: (T5-2) 1. Identify the contract with a customer. 2. Identify the performance obligation(s) in the contract. 3. Determine the transaction price. 4. Allocate the transaction price to each performance obligation. 5. Recognize revenue when (or as)...
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...Measurement in Financial Statements of Business Enterprises, states that revenue is not recognized until earned. That paragraph states that an entity's revenue-earning activities involve delivering or producing goods, rendering services, or other activities that constitute its ongoing major or central operations, and revenues are considered to have been earned when the entity has substantially accomplished what it must do to be entitled to the benefits represented by the revenues. That paragraph states that gains commonly result from transactions and other events that involve no earning process, and for recognizing gains, being earned is generally less significant than being realized or realizable. 605-1—25 > Installment and Cost Recovery Methods of Revenue Recognition 25-3 Revenue should ordinarily be accounted for at the time a transaction is completed, with appropriate provision for uncollectible accounts. Paragraph 605-10-25-1(a) states that revenue and gains generally are not recognized...
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...Lighthouse rendered the services, Lighthouse will connect the device to its service. Before the Ship Finder service can put in place the company required to customers sign two contracts, one for the sale of the devices and the other governing the provision of the service. The service contracts generally have duration twelve months and are billed monthly, customer may terminate the services at any time but the amounts paid for the devices are nonrefundable. The Lighthouse devices are made to be used exclusively with the Lighthouse services, the standard pricing for the Ship Finder Device are $10,000 per unit (MSRP) and for the Ship Finder Service are $300 a fixed monthly payments per unit. Payments for the devices are due upon completion of the installation and final acceptance by the customer. The services are priced at standard rates although discounts are offered; depending on the number of devices sold also the company offered device discounts. Nevertheless, the discounts are based on the number of to be purchased and does not appear to be unreasonable. II. Statement of the financial reporting issue or issues that is presented in the case. The issue acknowledged in the presented case is based on the question of how the business, Lighthouse, should recognize revenue for sales of its...
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...find quite a few differences. In general, IFRS has much less industry-specific guidance than does US GAAP. First, one of the main differences lies in timing of revenue recognition with respect to contracts criteria such as long-term construction or contingency. According to US GAAP, revenue must be realized or realizable with certainty. The revenue recognition criteria may lead to deferrals in recognition. On the contrary, IFRS just defines the revenue recognition as “when it is possible that future economic benefits will flow into the enterprise and can be measured reliably”. Second, as for the long-term contracts revenue recognition, if reliable estimate cannot be made, GAAP allows completed contract method. It differs from that of the IFRS, which allows the cost recovery method. Third, US GAAP provides a much more detailed guidance about separation and allocation of multiple-deliverable arrangements in comparison to the guidance of IFRS. The US GAAP does not allow revenue recognition if a company fails to deliver remaining elements. Under IFRS, an entity can recognize its revenue if delivery is probable. The new ASU entitled “Revenue from Contracts with Customers” definitely leads to some important changes from current GAAP. There are core revenue recognition principle and five steps in applying the principle. Initially, in step two “Indentify the Performance Obligations”, ASU changed the way we treat customer options. The ASU identify multiple performance obligations in arrangements...
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...2016 Dr. LauraAnn Migliore Sustaining Employee Performance The jobs that I have chosen to use within my company are: Store Manager: Responsible for the overall management of the store including the sales, financial, operation, and human resources to ensure maximum profitability. Sales Representative: Responsible for ensuring a great customer experience and maximum profitability. Performs various sales and register transactions and aids in controlling shrink through customer interaction. Performance Management Performance management is the process by which an organization ensures all employees are aware of the level of performance expected of them in the assigned role. This is including individual objectives and overall organizational objectives including improving productivity, employee growth, and time management. Performance management is a cycle of planning, executing, monitoring, analyzing, and forecasting. The systems are set up as a goal for each member of the team to achieve their personal goals and company standards that are expected. Performance management comes into factor on a daily basis with the Store Manager through constant communication on the daily business outcome and the results of the entire team. The sales associates’ knows what the daily expectations for the volume of the day and uses daily communication to notify the rest of the team. Store Manager’s lead by example and ask the right questions when the daily expectations...
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...also reevaluate the past financial reports to make it in line with the newly chosen methodology. The challenge for the company is how to account for the revenue it earned through sales and subsequent of fractional interest. Current revenue recognition method: The company recognized the revenue at the time of sale of a fractional interest and the remaining parts of the program are accounted as separate transactions. Initial sale of the fractional interest gives the company a profit because of the sales price provided in the agreement exceeds the cost of that proportion of the aircraft. To keep the profit, the company is required to sale the necessary volume to cover up the fixed costs of the operations. In general, the company will incur a loss when it is going the increase the number of aircrafts in the management of operations. Available options with their recognition: Option 1: Matches with the current revenue recognition method used by the company. The revenue is recognized at the time of sales of the fractional interest to the customer. Other attributes of the program such as, ongoing management of the aircraft, customer right to resell the aircraft to company at fair value, and the remarketing of the used aircraft, are to be considered as separate transactions Recognition: The sales price constitutes the increase in monetary gain by the company but corresponding proportionate cost of the aircraft is needs to be decreased to reach the final value of revenue...
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...on how long the training program will be, the objectives of the program, and how the program will be delivered An organization must also have certain benchmarks in place such as evaluation methods, performance standards, and feedback after the training is completed. Each of the five sales representatives will need training, however they are on different levels for sales knowledge and product knowledge and this needs to be assessed. The ultimate goal of the training will be to inform the sales representatives while increasing revenue for the organization. New Training Needs and Objectives The training needs within InterClean encompass product training and sales training. These are two areas both the older sales representatives and the newer representatives can always grow. This will assist the sales reps. sell InterClean’s products better through sales tactics and product knowledge. The demographic analysis will help determine the needs of each individual group. The older representatives are more advanced with their selling skills so they will need a different type of training then a newer sales rep. In breaking up the different sales representatives into two groups you separate them into their given skill sets. The newer representatives should be informed on basic sales tactics such as the four decision...
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