06 Jan Platinum Fitness offers group classes and regular
Platinum Fitness offers group classes and regular gym access The group classes are scheduled at 10AM, 1PM, 4PM, 7PM and 10PM each day, seven days a week, 52 weeks a year, except for ten (10) pre?announced holidays when the spa is closed The regular gym is open from 7AM until 11PM each day, and a member can arrive without an appointment, and may use a workout designed by the spa, or use his/her own program Memberships are sold as follows: Term Regular Gym Group Classes 1 Year $ 180 $ 120 2 Year $ 300 $ 150Basically, a member buys a membership to each amenity of the club, regular access and group classesFranco purchases a two?year membership to both the gym and the group classes on March 1, 2017 Platinum Fitness records the income for financial statement purposes on a pro-rata basis(a) Platinum Fitness operates as a calendar year, accrual basis taxpayer Franco purchases a 2 year membership on April 1, 2017 by paying cash of $450 How should Platinum Fitness account for this payment?(b) Would your answers in (a) change if Platinum Fitness operated as a cash method taxpayer?Use up to two pages for these answers Answers should be typed All answers must be explained Computations alone are not enough
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