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MBA 524 MBA524 MBA/524 Week 7 Assignment Capitalization of Costs at Salesforce.com.docx

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MBA 524 MBA524 MBA/524 Week 7 Assignment Capitalization of Costs at Salesforce.com.docx

Capitalization of Costs at Salesforce.comdiscusses the history, growth, and accounting methods used by Salesforce in relation to the impact that it could have for investors.
Because of the recent concerns around the organization’s capitalization of costs, and nonstandard accounting methods; Dean is wondering whether he should consider Saleforce as an investment opportunity.

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MBA 524 MBA524 MBA/524 Week 7 Assignment Capitalization of Costs at Salesforce.com.docx

Capitalization of Costs at Salesforce.comdiscusses the history, growth, and accounting methods used by Salesforce in relation to the impact that it could have for investors.
Because of the recent concerns around the organization’s capitalization of costs, and nonstandard accounting methods; Dean is wondering whether he should consider Saleforce as an investment opportunity.
Dean acknowledges that the Salesforce sales and products have experienced positive growth. He is also aware of the growing criticism of the company’s accounting practices.
From Dean’s perspective on whether to choose to invest in Salesforce, the following will need to be examined; Salesforce’s competitive and sustainable growth factors, the logic of Saleforce’s policy decisions around development
costs, the company’s metric choices, and finally the letter from Salesforce to FASB, to determine if the logic used to justify that their policies and procedures are valid.Salesforce is a cloud-based customer relationship management (CRM) platform.
Salesforce has varying components that can be used to augment their customers marketing, sales, technical and customer support functions, supply chain management, and enterprise resource planning.
The goal of Salesforce is to help an organization communicate with various stakeholders including customers, partners, and internal members. Salesforce allows a company to track activity, and does so in a secure way,through a cloud-based platform.
In 2000, Salesforces launched their first CRM service and by 2004 completed its initial public offering (IPO). By then, annual revenue growth had averaged forty-six percent with annual customer growth averaging thirty-seven percent.
The organization continued to be successful over the years in regard to sales and growth. In 2010, Salesforce was one of three vendors to offer the CRM platform that earned over $1 billion in sales revenue.
By August 2011, Salesforce reached a market capitalization in excess of fifteen billion dollars (Kelly, 2013). In the last ten years, Salesforce has

MBA 524 MBA524 MBA/524 Week 7 Assignment Capitalization of Costs at Salesforce.com.docx

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