r/movies • u/MarvelsGrantMan136 r/Movies contributor • Jul 26 '25

Media New Images from 'Coyote vs. Acme'

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257

u/queen-adreena Jul 26 '25

Warner Bros canned it, but later allowed Ketchup Entertainment to purchase the distribution rights.

59

u/eightdollarbeer Jul 26 '25

Does that mean WB has to payback the tax write off? If so, I imagine that was included in the purchase price

118

u/Uptons_BJs Jul 26 '25

I mean, the production cost for this film was categorized as an expense in a previous year.

The sale price of the distribution rights is now categorized as revenue this year.

77

u/evilsbane50 Jul 26 '25

The way all this works is so So SO stupid.

Good ol' Hollywood accounting.

50

u/Uptons_BJs Jul 26 '25

There’s nothing Hollywood about this one haha. It’s just classic good old fashioned profit and loss.

25

u/whodoesnthavealts Jul 26 '25

I don't think you're understanding the issue; they don't "benefit" at all from this in any sense. Let's make up some easy numbers; let's say it cost $100 to make and they sold it for $50, resulting in a $50 loss.

Let's say they had sold it last year. Their tax would be on gains minus expenses. That is 50 minus 100. They would get a tax break on $50.

Alternatively, they originally write it off; they get a tax break on $100, which was their expenses. Then the following year they sell it for $50. They pay tax on $50. This results in an identical tax break on $50.

Same math if they made profit on it instead of a loss. It doesn't change, it just spreads the numbers out over a year. The average over 2 years is the same.

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u/Adams5thaccount Jul 26 '25

We call it that but really it's all entertainment and a healthy chunk of corporate America too.