Assume F&S offers a deal whereby enrolling in a new membership for $1,000 provides a year of unlimited access to facilities and also entitles the member to receive a voucher redeemable for 30% off yoga classes for one year. The yoga classes are offered to gym members as well as to the general public. A new membership normally sells for $1,080, and a one-year enrollment in yoga classes sells for an additional $450. F&S estimates that approximately 50% of the vouchers will be redeemed. F&S offers a 10% discount on all one-year enrollments in classes as part of its normal promotion strategy.

a. & b.

Indicate below whether each item is

a separate performance obligation. For each separate performance obligation you have indicated, allocate a portion of the contract price.

c.

Prepare the journal entry to recognize revenue for the sale of a new membership.

2.

Assume F&S offers a Fit 70 coupon book with 70 prepaid visits over the next year. F&S has learned that Fit 70 purchasers make an average of 60 visits before the coupon book expires. A customer purchases a Fit 70 book by paying $450 in advance, and for any additional visits over 70 during the year after the book is purchased, the customer can pay a $25 visitation fee per visit. F&S typically charges $25 to nonmembers who use the facilities for a single day.

a. & b.

Indicate below whether each item is a separate performance obligation. For each separate performance obligation you have indicated, allocate a portion of the contract price.

c.	Prepare the journal entry to recognize revenue for the sale of a new Fit 70 book.