In alt.cellular.sprintpcs CozmicDebris <isheforreal> wrote:
>
> It is clearly a loss. The monthly charge paid to the company is for
> services rendered to use the phone, not equipment subsidized. This is
> clearly stated in every service agreement.
>

You know very well that a subsidy is not a loss on the balance sheet; it is an
expense. To make a profit, they have to earn more revenue than they put out
in expenses [which include the subsidy, labor, infrastructure and other fixed
costs]. A loss is only if they fail to net a profit. Another write off [or
loss] is depreciation, and that clearly is a category that a subsidy does NOT
fall into [although it is a category their inventory of phones can fall into].


> In any event, every carrier reports the loss as a seperate line item on
> their quarterly financials, and has done so for years. The government
> (specifically the IRS and SEC) do not share your opinion. Grocery stores
> and other big box stores get to right off the loss on their loss leaders
> (products sold below cost to generate traffic)- this is no different.
>

Yes, it is for depreciation of depreciable assets. Company vehicles,
depritiating inventory, even infrastructure all allow for that kind of loss.
A subsidy, however, is NOT a loss, it is an expense.

--
Thomas T. Veldhouse

America is the country where you buy a lifetime
supply of aspirin for one dollar, and use it up in two weeks.