Best Buy Co. Inc. Essay examples
Best Buy Co., Inc. is a publically traded company on the New York Stock Exchange, represented by their stock symbol: BBY.N. As a publically traded company, Best Buy is required to prepare and file an annual 10K report. It is important to note that some information may be biased toward Best Buy because their management files the financial reports. For this reason, it is crucial to analyze the given information thoroughly and completely. The information was analyzed to provide results that are most important to consider in investing decisions.
Best Buy recognizes revenue from six categories: consumer electronics, computing and mobile phones, entertainment, appliances, services and other. Their revenue arises primarily from sales of merchandise and services, but they also record revenue from sales of service contracts, extended warranties, other commissions and credit card programs (Revenue Recognition, 67). Computing and mobile phones generates the most revenue, which consists of 47% of domestic revenue, and 49% of international revenue (Financial Statements and Supplementary Data, 90).
Best Buy recognizes revenue at the time the customer takes possession of merchandise or receives services. The revenue is considered net of estimated returns. Best Buy retrieves historical return data to estimate sales returns (Critical Accounting Estimates, 49). For store sales, revenue is recognized when the customer receives and pays for the…