Columbia Arena Company
Pro Forma Operating Budget - 2016
			2015		2016
Revenues:
Rent from Sports Teams			$465,000
Rent from Events			$729,000
Equipment Rent			$27,600
Concessions (Gross)			$2,512,000
Merchandise (Gross)			$244,600
Advertising and Sponsorships			$580,400
Naming Rights			$327,000
Box Office			$150,560
Suite Revenue			$781,700
Club Seat Revenue			$549,360
Ticket Fees			$654,000
Parking			$482,010
Total Revenues			$7,503,230
Less COGS:
Concessions COGS			$1,507,300
Merchandise COGS			$122,300
Total COGS			$1,629,600
Gross Profit			$5,873,630
Operating Expenses:
Personnel			$981,000
G&A			$218,000
Non-reimbursed Event Costs			$163,500
Utilities			$490,500
Insurance			$272,500
Maintenance			$369,800
Contract Services			$119,900
Marketing and Promotion			$218,000
Management Fee			$109,000
Reserve			$163,500
Total Operating Expenses			$3,105,700
Operating Income (Loss)			$2,767,930
2. After you have calculated the 2016 budget, suppose your boss asks you to revise it so that overall revenues increase by 4% and operating expenses decrease by 1.5%. Based on current trends in facility management, what revenues do you anticipate can be increased? What expenses can be decreased? Use the 2016 budget that you created in Problem 1 and create a new 2016 budget based on the revenue increases and expense decreases outlined in Problem 2 and your work on Problem 2a. 2016 is to be calculated by the following. It is forecasted that costs and expenditures will change in 2016 as follows: Merchandise COGS, G&A, Event Costs, and Maintenance will increase by 2.5% Concessions COGS will increase by 4.5% Utilities will increase by 8.0% Personnel will increase by 2.5% Insurance, Contract Services, Marketing, Management Fee, and Reserve are forecasted to remain the same. The arena is expected to generate cash receipts in 2016 as follows: All rent will increase by 5.5% Concessions Gross will increase by 4.0% Merchandise Gross, Suite Revenue, Club Seating Revenue, Advertising Revenue, and Naming Rights are forecasted to remain the same. Box Office, Parking, and Ticket Fee revenues will decrease by 2.3%.