Pioneer Films has just finished a production of sharknado 5, the latest action film. the...
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Accounting
Pioneer Films has just finished a production of sharknado 5, the latest action film. the total production costs were $5 million. all salaries were fixed and part of the $5 million. Marketing will be handeled by company X and they will invest 3,000,000 and receive 20% of Pioneer's revenue. Pioneer will receive 62.5% of the box office receipts. ( the 20% for marketing comes out of the 62.5%)
1) what is the breakeven point to Pioneer for the movie in terms of a) revenues received by Pioneer and b) total box office receipts?
2) assume in its first year the movie makes $300 Million in box office receipts, what is the operating income to Pioneer from the movie in its first year?
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