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Complete Case details are given below :
Case Name : Accounting for Content at Demand Media
Authors : Chris Sturby, Jessica Kelly
Discipline : Accounting
Case Length : 19 pages
Solution sample availability : YES
Plagiarism : NO (100% Original work)
Description for case is given below :
An analyst is assessing Demand Media's accounting policies in the face of media scrutiny around its capitalization of media costs as well as some of its non-GAAP disclosures. She has to decide whether it is appropriate to capitalize these costs. In order to do so, she must evaluate whether the costs meet the definition of an asset. After analyzing the company, its business model and its strategy, she can compare its content costs to various other companies that create "content" (intellectual property); competing accounting policies are also examined. The analyst can then determine the appropriate accounting treatment and whether any adjustments are warranted. With respect to non-GAAP earnings, she can decide whether the metrics proposed by the company are appropriate in order to measure performance.
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