Manage the Band

The Receivables is the best band in town. They have a new CD and a lot of local fans. Now, they must take their show on the road to reach new fans across the country.

You are the new management team. Your job is to get the band on the road. You have to use your business and accounting skills to make the right strategic decisions and manage a new tour.

Here’s how their old tour looked before everything fell apart.

1. How many concerts were planned for the tour?
2. What was the ratio of merchandise sales to total revenue?
3. How important were merchandise sales to covering costs?
4. If the new tour had fewer concerts, would the fixed costs change? Why or why not?
5. If there were fewer concerts, how could the band make up for the loss in revenue?