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Ebay Inc Internet Success Or Fairy Tale

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Running Head: eBay Inc. INTERNET SUCCESS OF FAIRY TALE eBay Inc. Internet Success of Fairy Tale Name Instructor Institutional Affiliation Date 1 eBay Inc. INTERNET SUCCESS OF FAIRY TALE 2 Discussion 1. Use the 2002 Financial Statement data to replicate the Meyer's report calculations that illustrate the following conclusion based on the 2001 data reached in the report: eBay has never been profitable. Why? Why not? Indeed based on the information provided and the analysis in the Meyer's report, eBay has never been profitable but rather the company has been manipulating its statements to reflect its profitability. From the company’s consolidated income for the period of 2000, 2001, and 2002, the company reported positive net income for entire three year period (Page 9). However, in page 11 under (Note 1) section summary of significant accounting policies, the company reported negative pro forma net income. The company indicated that the net income is negative because they did not integrate the value of option grants at fair value as one of the operating expense. In other words, the company did not recognize the option grant as a net expense but in their consolidated income st ...
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