JP 3E Holdings Inc (JPTE)

[Mike Fletcher]

For purposes of an example, let's say the life of the licensing agreement is one year, then SPZI would record $375,00 of revenue per quarter for the 4 quarters starting Q4 2007. Here are the quarterly journal entries per GAAP (B/S = Balance Sheet --- I/S = Income Statement):


Q4 2007

debit: Cash (B/S) $500,000
credit: Deferred Revenue (B/S) $500,000

debit: Amortization of Deferred Revenue (B/S) $375,000
credit: Revenue (I/S) $375,000


Q1 2008

debit: Cash (B/S) $500,000
credit: Deferred Revenue (B/S) $500,000

debit: Amortization of Deferred Revenue (B/S) $375,000
credit: Revenue (I/S) $375,000


Q2 2008

debit: Cash (B/S) $500,000
credit: Deferred Revenue (B/S) $500,000

debit: Amortization of Deferred Revenue (B/S) $375,000
credit: Revenue (I/S) $375,000


Q3 2008

debit: Amortization of Deferred Revenue (B/S) $375,000
credit: Revenue (I/S) $375,000