Flavio's Fitness Club provides monthly memberships as well as personal training sessions. The personal trainers earn 50% of the revenue for all personal training sessions. The Fitness Club also sells nutrition products. Flavio's general ledger accounts indicate the following for the year. The front desk staff wages expense remains the same throughout the year.

-If a traditional income statement is prepared for the year, what is operating income at Flavio's Fitness Club?
A) $147,000
B) $180,000
C) $227,000
D) $250,000

Question

Flavio's Fitness Club provides monthly memberships as well as personal training sessions. The personal trainers earn 50% of the revenue for all personal training sessions. The Fitness Club also sells nutrition products. Flavio's general ledger accounts indicate the following for the year. The front desk staff wages expense remains the same throughout the year.
 
-If a traditional income statement is prepared for the year, what is operating income at Flavio's Fitness Club?
A) $147,000 
B) $180,000 
C) $227,000 
D) $250,000

Quizplus · Accepted Answer

Operating income is calculated by subtracting operating expenses from net sales. In this case, net sales are $250,000 and operating expenses are $103,000, so operating income is $250,000 - $103,000 = $147,000.

Flavio's Fitness Club Provides Monthly Memberships as Well as Personal