Q1.Describe the key aspects of Oracles business: what does it sell, to whom, and how? How has its business success reflected the unusual economics of software? (3 pts)
Q2.What assumptions underlie Oracle’s recognition of revenue for license fees? Are these assumptions reasonable given the firm’s business & operating policies? (3 pts)
Q3. Estimate Oracle’s 1990 sales if revenue is recognized at delivery rather than when the contract is signed. Hint: use the estimate provided by the controller of the effect of recognizing revenue at delivery on days receivable. Be clear on any assumptions you make. (4 pts)
Q4.If revenue is recognized at delivery rather than when the contract is signed, what would be the effect of this accounting change on the company’s 1990 net income? Start from your estimate of the sales impact from Q3 above. (3 pts)
Q5. How might a change in revenue recognition affect Oracles stock price; customers; lending contracts; and management compensation? (4 pts)

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