Lifetime Fitness 2010 Annual Report Download - page 54

LIFE TIME FITNESS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Table amounts in thousands, except share and per share data)
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expensed in the current period instead of deferred over the estimated average membership life. The related
advertising, office, rent and other expenses incurred during this period are expensed as incurred.
Cash and Cash Equivalents — We classify all unrestricted cash accounts and highly liquid debt instruments
purchased with original maturities of three months or less to be cash and cash equivalents.
Restricted Cash — We are required to keep funds on deposit at certain financial institutions related to certain of our
credit facilities. Our lender or lenders, as the case may be, may access the restricted cash after the occurrence of an
event of default, as defined under their respective credit facilities.
Accounts Receivable — Accounts receivable is presented net of allowance for doubtful accounts. The rollforward of
these allowances are as follows:
December 31,
2010 2009
Allowance for doubtful accounts — beginning of period ................................................... $389 $267
Provisions ............................................................................................................................ 166 326
Write-offs against allowance ............................................................................................... (405) (204)
Allowance for doubtful accounts — end of period ............................................................. $150 $389
Center Operating Supplies and Inventories — Our operating supplies are primarily center supplies such as towels
and pool chemicals and materials for our child centers and other activities. Inventories are stated at the lower-of-
cost-or-market value. Our inventories primarily consist of spa, café and nutritional products as well as heart rate
monitors. These balances are as follows:
December 31,
2010 2009
Center operating supplies .................................................................................................... $ 4,982 $ 4,448
In-center businesses inventory and supplies ....................................................................... 10,812 8,758
Apparel ............................................................................................................................... 989 798
Other ................................................................................................................................... 498 617
Total center operating supplies and inventories .................................................................. $17,281 $14,621
Prepaid Expenses and Other Current Assets — Prepaid expenses and other current assets consist of the following:
December 31,
2010 2009
Deferred costs associated with personal training deferred revenue .................................... $ 3,095 $ 2,876
Prepaid lease obligations .................................................................................................... 3,100 3,134
Prepaid marketing and media expenses .............................................................................. 1,894 1,373
Other prepaid expenses ....................................................................................................... 4,240 2,996
Other current assets ............................................................................................................ 989 2,559
Total prepaid expenses and other current assets ................................................................. $13,318 $12,938
Property and Equipment — Property, equipment and leasehold improvements are recorded at cost. Improvements
are capitalized, while repair and maintenance costs are charged to operations when incurred. The cost and
accumulated depreciation of property and equipment retired and other items disposed of are removed from the
related accounts, and any residual values are charged or credited to income.