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Procter & Gamble Co. (NYSE:PG)

Analysis of Revenues

Advanced level

Accounting Policy on Revenue Recognition

P&G’s revenue is primarily generated from the sale of finished product to customers. Those sales predominantly contain a single performance obligation and revenue is recognized at a single point in time when ownership, risks and rewards transfer, which can be on the date of shipment or the date of receipt by the customer. A provision for payment discounts and product return allowances is recorded as a reduction of sales in the same period the revenue is recognized. The revenue recorded is presented net of sales and other taxes P&G collects on behalf of governmental authorities. The revenue includes shipping and handling costs, which generally are included in the list price to the customer.

Trade promotions, consisting primarily of customer pricing allowances, merchandising funds and consumer coupons, are offered through various programs to customers and consumers. Sales are recorded net of trade promotion spending, which is recognized as incurred at the time of the sale. Most of these arrangements have terms of approximately one year. Accruals for expected payouts under these programs are included as accrued marketing and promotion in the Accrued and other liabilities line item in the Consolidated Balance Sheets.

Source: 10-K (filing date: 2019-08-06).

Revenues as Reported

Procter & Gamble Co., Income Statement, Revenues

US$ in millions

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12 months ended Jun 30, 2019 Jun 30, 2018 Jun 30, 2017 Jun 30, 2016 Jun 30, 2015 Jun 30, 2014
Beauty 12,897  12,406  11,429  11,477  18,135  19,507 
Grooming 6,199  6,551  6,642  6,815  7,441  8,009 
Health Care 8,218  7,857  7,513  7,350  7,713  7,798 
Fabric & Home Care 22,080  21,441  20,717  20,730  22,277  26,060 
Baby, Feminine & Family Care 17,806  18,080  18,252  18,505  20,247  20,950 
Corporate 484  497  505  422  466  738 
Net sales 67,684  66,832  65,058  65,299  76,279  83,062 

Based on: 10-K (filing date: 2019-08-06), 10-K (filing date: 2018-08-07), 10-K (filing date: 2017-08-07), 10-K (filing date: 2016-08-09), 10-K (filing date: 2015-08-07), 10-K (filing date: 2014-08-08).

Item Description The company
Net sales Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss). Procter & Gamble Co.’s net sales increased from 2017 to 2018 and from 2018 to 2019.