Why Was Apple Required to Spread Their IPhone Revenues Over

question 223

Multiple Choice

Why was Apple required to spread their iPhone revenues over a two-year period?

• A)Because of its newness, their returns might exceed the normal level of returns.
• B)Because they were required to provide software updates over that two year period.
• C)Because that was the estimated life of the iPhone.
• D)Because they needed to defer revenue recognition since they had a swap program available for future models.

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Definitions:

Software Program

A collection of instructions that enable a computer to perform specific tasks or operations; also referred to as software applications or simply software.

Explanatory Variables

Independent variables in a statistical model that account for changes in the dependent variable.

Correlation

A numerical index showing how much two or more variables move in correlation with each other.

Regression Model

A statistical technique used to estimate the relationships among variables, often used to predict a dependent variable based on one or more independent variables.