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11-20-2012, 08:07 PM
  #939
goyotes
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Join Date: May 2007
Location: Arizona
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Quote:
Originally Posted by barneyg View Post
Clark should borrow Skeete's Management Accounting 101 notes from DeVry. "Average operating expenses of $6M" means it costs $6M to operate an arena... that implies events, and revenue.
Actually, those costs are static costs that do not include costs that may be increased due to the number of events an arena may hold. There are certain costs associated with keeping an arena open, staff, utilities, basic maintenance, etc. The cost would increase if the arena has more events. $6M was presented (I am not saying the number is correct) as the very least it would cost the city because the city is the owner of the asset and has to pay for its operation (unless it wants to shutter the doors).

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