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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 229.60

+1.5%

Nov 25 3:59 PM EST

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To: Dwight E. Karlsen who wrote (31194)	12/26/1998 9:06:00 AM
From: Glenn D. Rudolph	Read Replies (1) of 164684

When the certificate is purchased, debit Cash (asset), credit Unearned Revenue (liability). Dwight, We are stating virtually the same thing. It is a matter of symantics on what line items names are used. The fact remains the revenue should not be sales and there are no costs of goods sold until redemption of the certificate. In the same manner, it is totally illegal to recognize cost of goods sold without recognizing the revenue in the same quarter. Any company that did this would be getting a call from the IRS, with heavy penalties the likely result. We are back to symantics. It is illegal to recognize cost of goods sold without recgonizing sales rather than just revenue. With AMZN wanting to tally all certificates in the sales column for this quarter, I would guess that they will use an estimated Cost of Goods Sold number. I would guess that the IRS allows this. I would agree although this is not GAAP. Amazon does not believe in GAAP regardless <VBG>. Glenn

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