Movie business seems to be glamorous and dream males for us sitting. Seeing our favorite stars and celebrity walking over the red carpet attending premiers and award functions like the iifa, Oscar. Every month with a new big movie launching and getting success. All the news and social media will come up with the facts and figures calculating that movie profit. But do you know nakes formula they use to calculate the actual profit gained by a movie?
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Hollywood accounting also known as Hollywood bookkeeping refers to the opaque or creative accounting methods used by the film, video, and television industry to budget and record profits for film projects. Expenditures can be inflated to reduce or eliminate the reported profit of the project, thereby reducing the amount which the corporation must pay in taxes and royalties or other profit-sharing agreements , as these are based on the net profit. Hollywood accounting gets its name from its prevalence in the entertainment industry—that is, in the movie studios of Hollywood at a time when most studios were located in Hollywood. Those affected can include writers and actors, but also production companies, producers and investors. Hollywood accounting can take several forms. In one form, a subsidiary is formed to perform a given activity and the parent entity will extract money out of the film’s revenue in the form of charges for certain «services». For example, a film studio has a distribution arm as a sub-entity, which will then charge the studio a «distribution fee» — essentially, the studio charging itself a sum it has total control over and hence control the profitability report of a project. Another form of Hollywood accounting is a reverse Tobashi scheme , in which the studio unjustly cross-collateralizes the accounting of two projects and shifts losses from a flop onto a profitable project by shifting costs involving internal operations. This way, two unprofitable projects are created out of one on paper alone, primarily for the purpose of eliminating net participation liabilities.
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Who makes the money when a movie goes big? Who gets all of that money? The distributing studio? The producers? The movie theaters? And what the heck is the difference between an «executive producer» and a «producer»? Some films seem to have half a dozen of each.
Discussion in ‘ General Discussion ‘ started by yoonitee , Mar 28, Search Unity. Log in Create a Unity ID. Unity Forum. Forums Quick Links. Making money from movies? Joined: Jun 27, Posts: 2,
What’s the average cost of making and selling a Hollywood blockbuster?
From a distance, the movie business might look pretty glamorous. Celebrities and producers glide down red carpets, clutch their Oscars and vacation in St. Barts…just because they can. The public can be fickle, the industry is in flux, and just about any movie is an extremely risky investment, even a film starring big name actors and actresses. Major studios and indie filmmakers alike now spend much of their days looking for new sources of revenue, because ticket sales are no longer the be-all and end-all for films. This is in part because it costs far more to make and market a film than it seems. Romantic comedies or some children’s films need to promote themselves via TV commercials and media advertisements, and those costs add up quickly. For any type of film, whether a blockbuster or an indie production, things like tax incentives and revenues from product placements can help pay down the budget. If they’re given an incentive to shoot a film in Canada or Louisiana or Georgia, producers will usually hustle to do so. Still, there are a few tried and true ways that films can attempt to make money. The percentage of revenues an exhibitor gets depends on the contract for each film. Many contracts are intended to help a theater hedge against films that flop at the box office by giving theaters a larger cut of ticket sales for such films, so a deal may have the studio getting a smaller percentage of a poorly performing film and a larger percentage of a hit film’s take. You can see the securities filings for large theater chains to see how much of their ticket revenue goes back to the studios.
From a distance, the movie business might look pretty glamorous. Celebrities and producers glide down red carpets, clutch their Oscars and vacation in St. Barts…just because they. The public can be fickle, the industry is in flux, and just about any movie is an extremely risky investment, even a film starring big name actors and actresses. Major studios and indie filmmakers alike now spend much of their days looking for new sources of revenue, because ticket sales are no longer the be-all and end-all for films. This is in part because it costs far more to make and market a film than it. Romantic comedies or some children’s films need to promote themselves via TV commercials and media advertisements, and those costs add up quickly. For any type of film, whether a blockbuster or an indie production, things like tax incentives and revenues from who makes money from movies placements can help pay down the budget. If they’re given an incentive to shoot a film in Canada or Louisiana or Georgia, producers will usually hustle to do so. Still, there are a few tried and true ways that films can attempt to make money. The percentage of revenues an exhibitor gets depends on the contract for each film. Many contracts are intended to help a theater hedge against films that flop at the box office by giving theaters a larger cut of ticket sales for such films, so who makes money from movies deal may have the studio getting a smaller percentage of a poorly performing film and a larger percentage of a hit film’s .
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