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11. REVENUE RECOGNITION | 12 Months Ended
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Feb. 28, 2019
Revenue from Contract with Customer [Abstract] |
Revenue from Contract with Customer [Text Block] | 1 1. REVENUE RECOGNITION Revenue is derived from the sales of children’s books and related products which are generally capable of being distinct and accounted for as a single performance obligation to deliver tangible goods. Substantially all of our books are sold to end consumers and publishing retail outlets. Revenues are recognized at shipping point, which is the point in time the customer obtains control of the products and risk of loss and rewards of ownership have been transferred. Shipping and handling fees are recorded as operating and selling expenses when the product is shipped and revenue is recognized. The Company estimates product returns based on historical return rates. The majority of the Company's contracts have a single performance obligation and are short term in nature. Sales taxes, that are collected from customers and remitted to governmental authorities, are accounted for on a net basis and therefore are excluded from net sales. Adoption of ASC Topic 606, “Revenue from Contracts with Customers” On March 1, 2018, the Company adopted Topic 606, as prescribed by the FASB, using the full retrospective method. Results for all reporting periods are presented under Topic 606. There was no change to net earnings or retained earnings due to the adoption of Topic 606, with the impact primarily related to the recording of our hostess awards program in gross sales and discounts and allowances, as opposed to recording the net costs in operating and selling expenses. Disaggregation of Revenue Refer to Note 13 – Business Segments for revenue by segment. Arrangements with Multiple Performance Obligations Certain contracts associated with the hostess awards program include sales incentives, such as discounted or free products. These incentives provide a separate performance obligation in the contract and material right to the customer. The transaction price is allocated to the material right based on its relative standalone selling price and is recognized in revenue as the performance obligations are satisfied, which occurs at shipping point or at the expiration of the material right. As our sales incentives are delivered with the associated products ordered, there is no deferral required. Revenue allocated to the material right are recognized in gross sales, discounts and allowances and cost of goods sold in our statement of earnings. Practical Expedients and Exemptions The Company generally expenses sales commissions when incurred. These costs are recorded within operating expenses. The Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Impact on Financial Statements As a result of applying Topic 606, the impact to the Company’s balance sheet as of February 28, 2018 was as follows:
|  |  |  |  |  |  |  |  |  | Without |
|  | As Reported |  |  | Adjustments |  |  | Adoption |
ASSETS |  |  |  |  |  |  |  |  |  |  |  |
Accounts receivable-Net |  | $ | 2,913,700 |  |  | $ | (99,900 | ) |  | $ | 2,813,800 |
Inventories-Net |  |  | 26,618,600 |  |  |  | (100 | ) |  |  | 26,618,500 |
Prepaid expenses and other assets |  |  | 1,259,000 |  |  |  | (117,000 | ) |  |  | 1,142,000 |
Total current assets |  |  | 33,514,600 |  |  |  | (217,000 | ) |  |  | 33,297,600 |
TOTAL ASSETS |  |  | 61,837,900 |  |  |  | (217,000 | ) |  |  | 61,620,900 |
LIABILITIES |  |  |  |  |  |  |  |  |  |  |  |
Other current liabilities |  |  | 3,517,900 |  |  |  | (217,000 | ) |  |  | 3,300,900 |
Total liabilities |  |  | 41,435,800 |  |  |  | (217,000 | ) |  |  | 41,218,800 |
As a result of applying Topic 606, the impact to the Company’s statement of earnings for the year ended February 28, 2018 was as follows:
|  |  |  |  |  |  |  |  |  | Without |
|  | As Reported |  |  | Adjustments |  |  | Adoption |
GROSS SALES |  | $ | 139,040,400 |  |  | $ | (13,193,200 | ) |  | $ | 125,847,200 |
Less discounts and allowances |  |  | (38,103,500 | ) |  |  | 13,174,700 |  |  |  | (24,928,800 | )
Transportation revenue |  |  | 11,047,700 |  |  |  | - |  |  |  | 11,047,700 |
NET REVENUES |  |  | 111,984,600 |  |  |  | (18,500 | ) |  |  | 111,966,100 |
COST OF GOODS SOLD |  |  | 35,824,300 |  |  |  | (4,893,000 | ) |  |  | 30,931,300 |
Gross margin |  |  | 76,160,300 |  |  |  | 4,874,500 |  |  |  | 81,034,800 |
OPERATING EXPENSE: |  |  |  |  |  |  |  |  |  |  |  |
Operating and selling |  |  | 17,694,700 |  |  |  | 4,876,500 |  |  |  | 22,571,200 |
Sales commissions |  |  | 35,359,000 |  |  |  | - |  |  |  | 35,359,000 |
General and administrative |  |  | 15,736,300 |  |  |  | - |  |  |  | 15,736,300 |
Total operating expenses |  |  | 68,790,000 |  |  |  | 4,876,500 |  |  |  | 73,666,500 |
INTEREST EXPENSE |  |  | 1,119,500 |  |  |  | - |  |  |  | 1,119,500 |
OTHER INCOME |  |  | (1,581,900 | ) |  |  | (2,000 | ) |  |  | (1,583,900 | )
EARNINGS BEFORE INCOME TAXES |  |  | 7,832,700 |  |  |  | - |  |  |  | 7,832,700 |
INCOME TAXES |  |  | 2,618,000 |  |  |  | - |  |  |  | 2,618,000 |
NET EARNINGS |  | $ | 5,214,700 |  |  | $ | - |  |  | $ | 5,214,700 |
As a result of applying Topic 606, the impact to the Company’s operating results by reporting segment for the year ended February 28, 2018 was as follows: UBAM
|  |  |  |  |  |  |  |  |  | Without |
|  | As Reported |  |  | Adjustments |  |  | Adoption |
GROSS SALES |  | $ | 121,364,700 |  |  | $ | (13,193,900 | ) |  | $ | 108,170,800 |
Less discounts and allowances |  |  | (28,657,900 | ) |  |  | 13,175,400 |  |  |  | (15,482,500 | )
Transportation revenue |  |  | 11,010,300 |  |  |  | - |  |  |  | 11,010,300 |
NET REVENUES |  |  | 103,717,100 |  |  |  | (18,500 | ) |  |  | 103,698,600 |
COST OF GOODS SOLD |  |  | 31,132,800 |  |  |  | (4,893,000 | ) |  |  | 26,239,800 |
Gross margin |  |  | 72,584,300 |  |  |  | 4,874,500 |  |  |  | 77,458,800 |
OPERATING EXPENSE: |  |  |  |  |  |  |  |  |  |  |  |
Operating and selling |  |  | 14,509,500 |  |  |  | 4,875,500 |  |  |  | 19,385,000 |
Sales commissions |  |  | 35,043,200 |  |  |  | - |  |  |  | 35,043,200 |
General and administrative |  |  | 3,602,000 |  |  |  | - |  |  |  | 3,602,000 |
Total operating expenses |  |  | 53,154,700 |  |  |  | 4,875,500 |  |  |  | 58,030,200 |
OPERATING INCOME |  | $ | 19,429,600 |  |  | $ | (1,000 | ) |  | $ | 19,428,600 |
Publishing
|  |  |  |  |  |  |  |  |  | Without |
|  | As Reported |  |  | Adjustments |  |  | Adoption |
GROSS SALES |  | $ | 17,675,700 |  |  | $ | 700 |  |  | $ | 17,676,400 |
Less discounts and allowances |  |  | (9,445,600 | ) |  |  | (700 | ) |  |  | (9,446,300 | )
Transportation revenue |  |  | 37,400 |  |  |  | - |  |  |  | 37,400 |
NET REVENUES |  |  | 8,267,500 |  |  |  | - |  |  |  | 8,267,500 |
COST OF GOODS SOLD |  |  | 4,691,500 |  |  |  | - |  |  |  | 4,691,500 |
Gross margin |  |  | 3,576,000 |  |  |  | - |  |  |  | 3,576,000 |
OPERATING EXPENSE: |  |  |  |  |  |  |  |  |  |  |  |
Operating and selling |  |  | 987,500 |  |  |  | - |  |  |  | 987,500 |
Sales commissions |  |  | 315,700 |  |  |  | - |  |  |  | 315,700 |
General and administrative |  |  | 509,600 |  |  |  | - |  |  |  | 509,600 |
Total operating expenses |  |  | 1,812,800 |  |  |  | - |  |  |  | 1,812,800 |
OPERATING INCOME |  | $ | 1,763,200 |  |  | $ | - |  |  | $ | 1,763,200 |

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- References No definition available. + Details
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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 + Details
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