Anthony Scilipoti

You sell, you know, today we made, you know, over eight hours, we made a thousand pens.

One of my salespeople sells a thousand pens.

Well, how do I calculate the cost of that 1,000 pens?

Do I just take the 8,000 pens that I do, divide, take 1,000 over 8,000, that's the total cost, and then that's what I allocate, right?

The reality is I sold them 1,000 pens and it was the last 1,000.

Do I stop the press, figure out the cost of that last thousand?

Do I average it?

Do I, even though I sold them the last ones, do I calculate the cost of the first thousand?

Which may be a little bit higher because there were some setup costs that changed my machine to make the thousand.

All of those three options, I gave you a business reality for what the accounting is.

FIFO, LIFO, or average cost.

So the reality is I sold them the last thousand.

The accountant said, well, we want to show high margin, so we're going to use average, and that's all good.

That ties that point.

But I want to get to your question because I don't think I got on a sidetrack and I want to answer your question about stock options.

So I think stock options should be an expense.

And if they're not an expense, I borrow from Buffett and even the chair of the accounting has said things like this, that if it's not an expense, then what is it?

You can choose to pay someone in stock options or you can choose to pay them in cash.

So if I pay all my employees, you pay, you have the same company or we're a competitor.

You pay all your employees with stock options.