The Following Footnote Appeared in a Recent Annual Report to Stockholders

question 138

Essay

The following footnote appeared in a recent annual report to stockholders of Sprint Corporation: "Certain wireless activation fees associated with unbundled sales continue to be deferred and amortized over the average life of the subscriber. Certain local installation fees are deferred and amortized over the average life of the customer."
Briefly explain why Sprint recognizes this type of revenue as it does.

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Definitions:

Ethnocentric

A viewpoint that one's own ethnic group or culture is superior to others, often leading to judgment of other cultures based solely on the values and standards of one's own culture.

International Operations

Business activities that a company conducts outside its home country, involving global management of production, logistics, marketing, and human resources.

Polychronic

Describes a cultural approach to time management that values multitasking and the handling of multiple activities simultaneously.

Polycentric

An approach in international business, where a company adapts its strategies and decisions to the local conditions of the countries where it operates.