Starbucks Corporation is the premier roaster, marketer, and retailer of specialty coffee in the world, operating in 68 countries. Starbucks generates revenues through company-operated stores, licensed stores, and consumer packaged goods. In 2015, revenues from company-operated stores accounted for 79% of total revenues. Starbucks states that its retail objective is to be the leading retailer and brand of coffee and tea by selling the finest quality coffee, tea, and related products. In addition, the company strives to provide the Starbucks Experience by exemplifying superior customer service and providing clean and well-maintained stores. Part of this experience involves providing free internet service to customers while they are enjoying their food and beverages. Read the requirementsLOADING.... Requirement 1. How would the cost of internet service be reported by Starbucks and on which financial statement? The cost of internet service would be reported by Starbucks as

Question

09-09-2020
Business

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Starbucks Corporation is the premier roaster, marketer, and retailer of specialty coffee in the world, operating in 68 countries. Starbucks generates revenues through company-operated stores, licensed stores, and consumer packaged goods. In 2015, revenues from company-operated stores accounted for 79% of total revenues. Starbucks states that its retail objective is to be the leading retailer and brand of coffee and tea by selling the finest quality coffee, tea, and related products. In addition, the company strives to provide the Starbucks Experience by exemplifying superior customer service and providing clean and well-maintained stores. Part of this experience involves providing free internet service to customers while they are enjoying their food and beverages. Read the requirementsLOADING.... Requirement 1. How would the cost of internet service be reported by Starbucks and on which financial statement? The cost of internet service would be reported by Starbucks as

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jepessoa jepessoa · Answer 1 · 2020-09-10T03:36:03+02:00

Answer:

Even though the information is not complete, all that we need is included in the question. Starbucks provides free internet service to their customers as part of the Starbucks Experience, therefore, the cost of providing free internet must be reported as an operating expense on the income statement. This cost must be treated similarly to any other operating expense, e.g. cleaning expenses, wages, insurance expense, etc.