Exhibit 2
Flash Report for the KFBS Allstars Concert
Event Month			7
Event Date			07/31/22
Projected Sales
A Seats			2,978
B Seats			2,945
C Seats			1,856
D Seats			881
	Total		8,660
Ticket Price
A Seats			$               58.00
B Seats			$               35.00
C Seats			$               16.00
D Seats			$               10.00
Projected Revenue			$    314,305.00
Average Ticket Price			$               36.29
Guaranteed Talent Cost			$    260,635.00
Attendance (includes Comp)			10,825
Other Ticket Revenue
Per ticket facility charge			$                 3.50
Per ticket service charge			$                 2.00
Projected Revenue from ticketing			$    361,935.00
Per sold ticket			$               41.79
Ancillary Revenues (per all attendees including comps)
Parking			$                 6.00
Concessions			$                 9.00
Merchandise			$                 4.00
			$               19.00
Ancillary Contract Terms
Parking	$  17,000.00	per event	$                 0.60	Per attendee
Concession	$  40,000.00	per event	$                 2.70	Per attendee
Merchandise	$  22,000.00	per event	$                 0.80	Per attendee
Fixed Cost per Event
Production			$             24,000
Operations			$             21,600
Advertising			$             25,000
	Total		$             70,600
Other Variable Costs including Insurance and supplies
			$3.00	Per attendee

1. Complete two selected cost-volume-profit analyses for the show illustrated in Exhibit 2, the KFBS Allstars (Think of there being two products - Regular Tickets and Comp Tickets):

a) How many tickets must the Coastal Credit Union Music Park sell to break even for KFBS?

b) How many tickets must Coastal  sell to earn $30,000 operating income after taxes, assuming a 20 percent tax rate?

Transcribed Image Text:

One day in early November, Pam Berg, Manager of the Coastal Credit Union Music Park, was reviewing the operating results for the year just completed in preparation for the executive board meeting the following Friday. While the year ended in the black, she was disappointed that the Coastal Credit Union Music Park failed to earn the budgeted profit goal. This was the second year since Ms. Berg assumed the manager's position at the Coastal Credit Union Music Park. After the somewhat disappointing first year, she was determined to exceed the budgeted profit in the coming year. While not all events developed exactly as expected at the time of preparing the budget for the year, there were no major surprises during the year. Yet, the operating results are below the budgeted goal. In addition, Pam was frustrated by the lack of clear guidelines for contract negotiations with artists, for setting ticket prices, and in dealing with unexpected low ticket sales for certain concerts. THE Coastal Credit Union Music Park FOR LIVE ENTERTAINMENT The Coastal Credit Union Music Park in Raleigh, North Carolina is an outdoor amphitheater that provides live concerts to the public from April through October each year, hosting as many as half a million patrons a year. The seven-month season usually hosts an average of 40 concerts, and 12 year- round staff plan and manage each season. Live Nation Entertainment Inc. operates the pavilion. Live Nation is one of the largest diversified promoters, producers, and venue operators for live entertainment events in the United States. It has 71 venues either directly owned or operated under lease or exclusive booking arrangements in 29 of the top 50 U.S. markets, including 14 amphitheaters or pavilions in 9 of the top 10 markets. Coastal Pavilion wants to be the nightlife for the Triangle (Raleigh-Durham-Chapel Hill, NC) and eastern North Carolina, and one of the most beautiful, technologically advanced, and successful amphitheaters in the world. It features the most modern state-of-the-art acoustics and video of any facility of its kind. In the last few years, Coastal Credit Union Music Park staged shows by the Dave Matthews Band, Alan Jackson, Brooks & Dunn, Toby Keith, Santana, Tim McGraw, Aerosmith, James Taylor, Jimmy Buffett, and many other national, regional, and local artists. The Pavilion claims, "There isn't a bad seat in the house. Whether you choose to spread a blanket on our gently sloping festival lawn or select a reserved seat in our pavilion seating area, you are quaranteed a great view of the action on the stage" (Coastal Credit Union Music Park website). Exhibit 1 shows the stage and seating of the amphitheater. History/Development The city of Raleigh and Pace Entertainment Company of Houston, Texas jointly built the Coastal Credit Union Music Park in 1991. Pace Entertainment and Cellar Door Inc. of Raleigh, NC had the initial contract to manage the Pavilion. Hardee's Food Systems, Inc. of Rocky Mount, NC, the original sponsor of the amphitheater, paid an annual fee to carry its name and logo on all signs and ads regarding the amphitheater. On February 3, 1999 Coastal Corp (http://tel.com) became the title sponsor for the amphitheater. The demand for the outdoor facility came about because the rapidly growing city of Raleigh lacked a major entertainment complex. In the late 1980s Pace Entertainment and the city of Raleigh came to an agreement to build the facility. The city of Raleigh would own the land while Pace Entertainment would own the facility and assume sole operations of the facility; Cellar Door would do the booking for all the concerts. Pace Entertainment would pay income taxes on earnings from the use of the facility. In 2008, Live Nation Entertainment Inc. acquired Pace Entertainment Inc. The amphitheater facility and its employees became part of Live Nation Entertainment Inc. Also, in 2009 Live Nation Entertainment Inc. acquired Cellar Door Inc. and merged with Clear Channel Communications Inc., one of the largest owners of radio stations in the country. This move brought together both worlds of the entertainment business. While the company has diverse holdings, the philosophy of Live Nation is "One Company, One Mission." Many companies that are now owned by Live Nation were at one time bitter rivals in the One day in early November, Pam Berg, Manager of the Coastal Credit Union Music Park, was reviewing the operating results for the year just completed in preparation for the executive board meeting the following Friday. While the year ended in the black, she was disappointed that the Coastal Credit Union Music Park failed to earn the budgeted profit goal. This was the second year since Ms. Berg assumed the manager's position at the Coastal Credit Union Music Park. After the somewhat disappointing first year, she was determined to exceed the budgeted profit in the coming year. While not all events developed exactly as expected at the time of preparing the budget for the year, there were no major surprises during the year. Yet, the operating results are below the budgeted goal. In addition, Pam was frustrated by the lack of clear guidelines for contract negotiations with artists, for setting ticket prices, and in dealing with unexpected low ticket sales for certain concerts. THE Coastal Credit Union Music Park FOR LIVE ENTERTAINMENT The Coastal Credit Union Music Park in Raleigh, North Carolina is an outdoor amphitheater that provides live concerts to the public from April through October each year, hosting as many as half a million patrons a year. The seven-month season usually hosts an average of 40 concerts, and 12 year- round staff plan and manage each season. Live Nation Entertainment Inc. operates the pavilion. Live Nation is one of the largest diversified promoters, producers, and venue operators for live entertainment events in the United States. It has 71 venues either directly owned or operated under lease or exclusive booking arrangements in 29 of the top 50 U.S. markets, including 14 amphitheaters or pavilions in 9 of the top 10 markets. Coastal Pavilion wants to be the nightlife for the Triangle (Raleigh-Durham-Chapel Hill, NC) and eastern North Carolina, and one of the most beautiful, technologically advanced, and successful amphitheaters in the world. It features the most modern state-of-the-art acoustics and video of any facility of its kind. In the last few years, Coastal Credit Union Music Park staged shows by the Dave Matthews Band, Alan Jackson, Brooks & Dunn, Toby Keith, Santana, Tim McGraw, Aerosmith, James Taylor, Jimmy Buffett, and many other national, regional, and local artists. The Pavilion claims, "There isn't a bad seat in the house. Whether you choose to spread a blanket on our gently sloping festival lawn or select a reserved seat in our pavilion seating area, you are quaranteed a great view of the action on the stage" (Coastal Credit Union Music Park website). Exhibit 1 shows the stage and seating of the amphitheater. History/Development The city of Raleigh and Pace Entertainment Company of Houston, Texas jointly built the Coastal Credit Union Music Park in 1991. Pace Entertainment and Cellar Door Inc. of Raleigh, NC had the initial contract to manage the Pavilion. Hardee's Food Systems, Inc. of Rocky Mount, NC, the original sponsor of the amphitheater, paid an annual fee to carry its name and logo on all signs and ads regarding the amphitheater. On February 3, 1999 Coastal Corp (http://tel.com) became the title sponsor for the amphitheater. The demand for the outdoor facility came about because the rapidly growing city of Raleigh lacked a major entertainment complex. In the late 1980s Pace Entertainment and the city of Raleigh came to an agreement to build the facility. The city of Raleigh would own the land while Pace Entertainment would own the facility and assume sole operations of the facility; Cellar Door would do the booking for all the concerts. Pace Entertainment would pay income taxes on earnings from the use of the facility. In 2008, Live Nation Entertainment Inc. acquired Pace Entertainment Inc. The amphitheater facility and its employees became part of Live Nation Entertainment Inc. Also, in 2009 Live Nation Entertainment Inc. acquired Cellar Door Inc. and merged with Clear Channel Communications Inc., one of the largest owners of radio stations in the country. This move brought together both worlds of the entertainment business. While the company has diverse holdings, the philosophy of Live Nation is "One Company, One Mission." Many companies that are now owned by Live Nation were at one time bitter rivals in the

Answer rating: 100% (QA)

Breakeven analysis for the KFBS Allstars concert To determine how many tickets the Coastal Credit Un... View the full answer