Question bodytone company sells lifetime health club

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Reference no: EM13349762

Question :

BodyTone Company sells lifetime health club memberships. For one up-front, nonrefundable fee, a customer becomes a lifetime member of BodyTone's network of health clubs.

The fee is $2,000. The fee adds full access to all of the club facilities plus an initial comprehensive physical, spiritual and mental wellness evaluation. The wellness evaluation is regularly sold separately for $400. Occasionally, BodyTone sells lifetime memberships without the wellness appraisal; the price is $1,750. BodyTone will reliably evaluate that the average customer will use the health club facilities for five years. On 1^st January, 2013, BodyTone received lifetime membership payments from 300 new customers. The direct cost of giving a wellness evaluation is $70, and the direct cost of giving health club access for one person for one year is $250. All of the wellness evaluations were completed during 2013. Make all of the journal entries essential in 2013 in connection with these 300 new memberships. Consider that all costs were incurred in cash.

Reference no: EM13349762

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