How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 491.12

+1.7%

Dec 8 3:59 PM EST

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To: Dave who wrote (50450)	10/2/2000 10:27:27 PM
From: The Duke of URL©	Read Replies (1) of 74651

"In 2000, MSFT had to increase their unearned revenue by $2B in order to make their net cash from operations" Dave, if you just don't understand how reserve accounts work, then my answer is: that, it is based on an actual number that is not quite yet income. For instance, if a product is sold with guaranteed upgrades, then the CASH received is deferred in part until the upgrades are delivered at a certain date. A less than scrupulous company might try to take all the $ into income now to make it look like they are doing better than they are, good accounting wise. If you really want MS to declare all this income early, then what you would get is overstated income and a bigger tax bill. Then you could help that waco accountant who thinks that stock options are a communist conspiracy write his webpage. :)) If you understand that these numbers are reflective of detailed contractual obligations and are still concerned I will tell you that it is very hard to change these numbers to differ from the contractual analysis. Duke

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