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1. Active and company enter a mutual agreement for the assets.
1. When your company purchases media, Active issues invoice, payable in cash and trade credits.
2. The asset value is replaced on the balance sheet with a pre-paid expense (the Trade Credit).
2. HST/QST charged on cash portion of media received.
3. The Trade Credit is held on the balance sheet at net realizable value of the asset surrendered, in GAAP compliance.
3. When Trade Credits are spent, an equal amount is credited to the pre-payment account and expensed on P&L, until all trade credits are spent.

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