50.1K

Verified Solution

Link Copied!

Required information The following information applies to the questions displayed below Lakewood Tennis Club (LTC) operates an indoor tennis facility. The company charges a $145 annual membership fee plus a member rental rate of $16 per court per hour. LTC's fiscal year-end is August 31. LTC's revenue recognition policy is described in Its financial statement notes as follows: Revenue Recognition-LTC generates revenue from two sources. Annual membership fees arise from providing 12 months of services to members, so they are reported as membership revenue each month as these services are provided. Court rental fees are generated by renting courts each day, so they are reported as service revenue when courts are used by members On August 31, 14 new members joined and paid the annual membership fee in cash. The memberships do not begin unt September 1. For the week ended September 11, LTC provided 200 court-hours of rental services for members and collected its fees in cash. On September 13, LTC price was $260, but LTC negotiated a lower amount ($250) that is to be paid in October. On September 15, LTC paid $2,000 to employees for the hours they worked from September 1-15. For the two weeks ended September 25, LTC provided 312 court-hours for members and collected its fees in cash. On September 26, LTC's courts were used for member's birthday party. LTC expects the member to pay the special event booking fee of $195 on Sat On September 27, LTC wrote a $350 check to purchased and received tennis balls and other supplies. The regular retail an advertising company to prepare advertising flyers that will be inserted in newspapers on October 1. On September 29, LTC received $195 on account for the member's birthday party that was held on September 26. On September 30, LTC submitted its electricity and natural gas meter readings to the suppliers Websites, the total charges for the month will be $290. This amount wil be paid on preauthorized online payment. 3-a. Using your answer to requirement 1 or 2, calculate LTC's preliminary net income for September

Answer & Explanation Solved by verified expert

See Answer