Account for free trading bonus on sign up

USA Discussion in 'Technical Queries' started by dreilly215, Jul 8, 2018.

  1. dreilly215

    dreilly215

    Joined:
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    Background:
    • Binary options trading company
    • End users sign up and deposit funds
    • End users purchase options
      • Options expire worthless
      • Options expire for profit
      • Options are traded for profit
      • Options are traded for loss
    Scenario:
    • Customer signs up and receives $10 in free trading money (sing up bonus)
    Question:
    • How do I account for for the initial "cash giveaway" free trading bonus?
      • Is this a contra revenue account?
      • Is this a deferred liability?
      • Is this a marketing expense?
    Notes:
    • I can see this being a contra revenue account if the end user profits but what if they don't?
     
    dreilly215, Jul 8, 2018
    #1
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