please answer:

-When should revenue from the new subscriptions be recognized? Describe in words. Give an example entry if you want.

-How would you classify the estimated sales returns stemming from the unconditional guarantee? Describe in words. Give an example entry if you want.

-How should the atlas premium be recorded? Describe in words and then give example entries using XX as your numbers.

Does the proposed plan achieve the goals of increasing the current ratio and decreasing the debt to equity ratio? Describe in words

QUESTION \#2 Healthy Living is a monthly magazine that has been on the market for 24 months. It currently has a circulation of 2.4 million copies. Negotiations are underway to obtain a bank loan in order to update the magazine's facilities. Healthy Living is producing close to capacity and expects to grow at an average of 15% per year over the next 3 years. After reviewing the financial statements of Healthy Living, Greg Olson, the bank loan officer, had indicated that a loan could be offered to Healthy Living only if it could increase its current ratio and decrease its debt to equity ratio to a specified level. Mark Widvy, the marketing manager of Healthy Living, has devised a plan to meet these requirements. Widvy indicates that an advertising campaign can be initiated to immediately increase circulation. The potential customers would be contacted after the purchase of another magazine's mailing list. The campaign would include: - An offer to subscribe to Healthy Living at three-fourths the normal price. - A special offer to all new subscribers to receive the most current world atlas whenever requested at a guaranteed price of $2. - An unconditional guarantee that any subscriber will receive a full refund if dissatisfied with the magazine. Although the offer of a full refund is risky, Widvy claims that few people will ask for a refund after receiving half of their subscription issues. Widvy notes that other magazine companies have tried this sales promotion technique and experienced great success. Their average cancellation rate was 25%. On average, each company increased its initial circulation threefold and in the long run increased circulation to twice that which existed before the promotion. In addition, 60% of the new subscribers are expected to take advantage of the atlas premium. Widvy feels confident that the increased subscriptions from the advertising campaign will increase the current ratio and decrease the debt to equity ratio. You are the controller of Healthy Living and must give your opinion of the proposed plan