Fit & Slim (F&S) is a health club that offers members various gym services.

Required:

Assume F&S offers a deal whereby enrolling in a new membership for $700 provides a year of unlimited access to facilities and also entitles the member to receive a voucher redeemable for 25% 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 $720, and a one-year enrollment in yoga classes sells for an additional $500. F&S estimates that approximately 40% 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.

Assume F&S offers a Fit 50 coupon book with 50 prepaid visits over the next year. F&S has learned that Fit 50 purchasers make an average of 40 visits before the coupon book expires. A customer purchases a Fit 50 book by paying $500 in advance, and for any additional visits over 50 during the year after the book is purchased, the customer can pay a $15 visitation fee per visit. F&S typically charges $15 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 50 book.

Complete this question by entering your answers in the tabs below.

Req 1A and 1B

Req 1C

Req 2A and 2B

Req 2C

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.

Item Description	Performance Obligation?		Stand Alone Prices		Percentage of Total Stand Alone Prices
Yoga discount voucher					0
Facilities access					0
Total stand alone price			$0		0%
Item Description	Percentage of Total Stand Alone Price		Total Transaction Price		Allocated Contract Price
Yoga discount voucher					$0
Facilities access					$0
Total contract price					$0

Req 1A and 1B

Req

repare the journal entry to recognize revenue for the sale of a new membership. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

Journal entry worksheet

Record the revenue for the sale of a new membership.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
1