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On a related question, I'm intrigued as to how this kind of market is different from Apple's App Store[1]. I know Google expenses its AdSense partner cost as tr

• camz 16y ago
  In tax, its all the same generally speaking. The only difference is where these costs enter the equation. Apple is similar to the situation above where they are accepting money and transferring a large portion of it back to the developer as a cost of sales. In the ad business above, the transfer of 70% income is a cost of sales that leads to gross profit. I havent looked over google's financials, but i would expect that the traffic acquisition cost is an expense and not a cost of sales. Expenses enter the calculation after gross profit. Sales - Cost of Sales = Gross Profit - Expenses = Net Income