(Solved): a-2. Use the horizontal model to record the effects of subscription revenue e ...

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a-2. Use the horizontal model to record the effects of subscription revenue earned during August 2019. Indicate the financial statement effect. (Enter decreases with a minus sign to indicate a negative financial statement effect.) a-3. Record the journal entry to show the effect of subscription fees received in advance and Subscription revenue earned during August 2019 . (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) b. Calculate the amount of subscription revenue earned by Evans Ltd. during the year ended December 31 , 2019 , for these 160 subscriptions sold in August 2019. Evans Ltd. is now considering the possibility of offering a lifetime membership option to its subscribers. Under this proposal, subscribers could receive the monthly newsletter throughout their lives by paying a flat fee of \( \$ 432 \). The one-year subscription rate of \( \$ 36 \) would continue to apply to new and existing subscribers who choose to subscribe on an annual basis. Assume that the average age of Evans Ltd.'s current subscribers is 38 and their average life expectancy is 78 years. Evans Ltd.'s average interest rate on longterm debt is \( 12 \% \) c-1. Using the information given, calculate the present value of a lifetime membership for an average subscriber. (Round PV factors to 4 decimal places and final answer to 2 decimal places.) c-2. Would it be profitable for Evans Ltd. to sell lifetime subscriptions? No Yes