1. On average how long does it take Groupon to pay merchants for coupons sold during 2010? (Hint: Turnover = Cost of Revenue/Avg accrued merchant payable)
2. Why is Adjusted CSOI important to Groupon? Look at the calculation in Exhibit 5 and comment on whether it assists investors in obtaining a better understanding of Groupon's operations or whether it clouds their understanding. Why?
3. Using the data in the case comment on the usefulness of free cash flow as a metric.

\fExhibit 2 GROUPON, INC. CONSOLIDATED STATEMENTS OF OPERATIONS {in thousands, except share and per share amounts} Year Ended December 31. zoos moo 2am Revenue $ 94 $ 30,471 5 713 ,365 Cost of revenue 89 19,542 433 .41 1 Gross prot 5 10.929 $9.954 Operating expenses: Marketing 163 4.548 263 .202 Selling. general and administrative 1.474 1458 233.913 Acquisition-related 293 .183 Total operating expenses 1.63? 12.006 700.293 Loss from operations [1.632) {I 77} (420.344) interest and other income (expense). net 90 (16) 284 Loss before provision for Income taxes (I .542) (l ,093) (420.060) Provision (benet) for income taxes 248 (6.6?4) Net loss (1.542) (L341) (413.386) Less: Net loss attributable to noncontrolling interests 23.746 Net loss attributable to Groupon, Inc. (1.542) (I .341) (389.640) Dividends on preferred stock [277) [5.575) (1.362) Redemption of preferred stock in excess of can'ying value {52 .893) Adjustment of redeemable noncontrolling interests to redemption value (12.425) Preferred stock distributions (339} _ _ Net loss attributable to common stockholders 5 (2.158} 5 {6,916} 5 (456,320)