Annual report pursuant to Section 13 and 15(d)

8. Deferred Revenue and Advances

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8. Deferred Revenue and Advances
12 Months Ended
Dec. 31, 2015
Deferred Revenue Disclosure [Abstract]  
Deferred Revenue and Advances

As of December 31, 2015 and 2014, the Company had advances of $599,167 and $817,167, respectively.

 

As a result of the Merger, the Company assumed from A Squared an April 2013 agreement for an advance of $450,000 for the music rights of certain A Squared properties. During the second quarter of 2014, the Company executed an agreement with the same counterparty for another music advance of $250,000 covering the properties held by the Company prior to the Merger. Pursuant to ASC 928-430-25-1, the Company began recognizing revenue under these agreements on May 1, 2014.

 

During the third quarter of 2014, the Company executed another music advance agreement for $250,000. Pursuant to ASC 928-430-25-1, the Company began recognizing revenue under these agreements on August 1, 2014.

 

As of December 31, 2015 and 2014, the Company had deferred revenue of $359,370 and $65,410, respectively. Deferred revenue represents amounts collected from licensees and customers for which revenue recognition criteria have not been met.