Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2011

Summary of Significant Accounting Policies

Schedule of promotional allowances

	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
	(in thousands)
Rooms	$	7,231	$	6,253	$	17,970	$	18,213
Food and beverage	29,586		25,541		78,275		76,576
Other	2,824		2,407		7,512		7,731
Total promotional allowances	$	39,641	$	34,201	$	103,757	$	102,520

Schedule of estimated cost of providing complimentary services

	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
	(in thousands)
Rooms	$	2,615	$	2,378	$	6,639	$	6,981
Food and beverage	20,383		19,137		56,647		57,332
Other	1,792		1,401		4,586		4,872
Total cost of complimentary services	$	24,790	$	22,916	$	67,872	$	69,185

Allocation of net income attributable to shareholders under the two-class method

	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
	(in thousands)
Net income attributable to the shareholders of Penn National Gaming, Inc. and subsidiaries	$	70,803	$	48,345	$	198,320	$	93,665
Net income attributable to the shareholders of Penn National Gaming, Inc. and subsidiaries applicable to preferred stock	13,433		9,252		37,619		17,853
Net income attributable to the shareholders of Penn National Gaming, Inc. and subsidiaries applicable to common stock	$	57,370	$	39,093	$	160,701	$	75,812

Reconciliation of the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS

	Three Months Ended September 30,		Nine Months Ended September 30,
	2011	2010	2011	2010
	(in thousands)
Determination of shares:
Weighted-average common shares outstanding	78,242	77,414	78,264	78,228
Assumed conversion of dilutive employee stock-based awards	1,929	817	1,787	796
Assumed conversion of preferred stock	27,278	27,278	27,278	27,428
Diluted weighted-average common shares outstanding	107,449	105,509	107,329	106,452

Calculation of basic and diluted EPS for the entity's common stock

	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
	(in thousands, except per share data)
Calculation of basic EPS attributable to the shareholders of Penn National Gaming, Inc. and subsidiaries:
Net income attributable to the shareholders of Penn National Gaming, Inc. and subsidiaries applicable to common stock	$	57,370	$	39,093	$	160,701	$	75,812
Weighted-average common shares outstanding	78,242		77,414		78,264		78,228
Basic EPS	$	0.73	$	0.51	$	2.05	$	0.97
Calculation of diluted EPS attributable to the shareholders of Penn National Gaming, Inc. and subsidiaries:
Net income attributable to the shareholders of Penn National Gaming, Inc. and subsidiaries	$	70,803	$	48,345	$	198,320	$	93,665
Diluted weighted-average common shares outstanding	107,449		105,509		107,329		106,452
Diluted EPS	$	0.66	$	0.46	$	1.85	$	0.88

Weighted-average assumptions used in Black-Scholes option pricing model

Nine Months Ended September 30,	2011		2010
Risk-free interest rate	2.04	%	2.00	%
Expected volatility	47.24	%	49.18	%
Dividend yield	—		—
Weighted-average expected life (years)	5.77		5.68
Forfeiture rate	5.00	%	5.00	%