Boxoffice-August.02.1976

accurately the tax effect of these changed
circumstances.
Unless adequate records are kept up to
date in the business, he may have to spend
some time finding out how much net earnings
have increased or decreased. However,
he is more likely to overlook non-business
income and personal situations that would
have an effect on his tax. Some situations
could have called for an amended tax estimate
as early as June, but it is more likely
that the last two payments in September of
this year and January of next year will need
more careful attention.
Having the funds for use in the theatre
business that are represented by a
relatively
smaller tax overpayment can be as important
to one exhibitor as a larger overpayment
to another one. A younger exhibitor
just starting in business, who overestimates
adjusted gross income by $1,000.
will have his income tax inflated by $190
if he is in the 19 per cent bracket. Another
one in the 39 per cent bracket will overpay
by $390.
The loss or creation of an exemption
during the year will alter an income tax
obligation, upward or downward, by a substantial
amount even in the lowest tax
bracket.
Se£6u
i^eZoy STRUCTURES
ENGINEERED FOR
STRENGTH AND BEAUTY
Manufactured and Installed
By Our Own
Highly Trained Crews
SCREEN
TOWERS
-^H
Hundred] of top quolity Selby towers used by
the finest theatres for 25 yeors. Engineering
skill
and integrity at low cost.
Following are some of the principal situations
which may sharply increase or decrease
an income tax obligation—all of
which may occur after filing the initial estimate.
Business Net Earnings . . . When a theatre
business is growing rapidly, has a larger
volume of attendance and concessions sales
that are more profitable than earlier anticipated,
net earnings may exceed greatly the
figure originally used as an estimate. A
good many business expenses are fixed.
such as rent or mortgage payments, utilities
and other similar payments. They do not
rise and fall with gross receipts, so net
earnings may increase at an even faster
pace than the increase in receipts. This
could warrant an amended estimate.
In another situation, special circumstances
may cause net earnings to drop
substantially. As an example, an exhibitor
may be away from his business for a prolonged
period due to illness. This could
depress net earnings sharply as gross receipts
drop and many fixed expenses run
on while he is absent. When there is an economic
slump, or a long strike in a major
industry that adversely affects theatre attendance,
this also could reduce gross receipts
sharply. At the same time expenses
remain high, altering the ratio of receipts
to expenses, and reducing taxable income.
Amending his tax estimate downward could
provide some cash to help him retain usual
business earnings.
Depreciation Cliarges . . . When he filed
his original estimate, an exhibitor may have
failed to take into account that in this year
he no longer has certain depreciation
charges on theatre and concessions equipment
that had been claimed in previous
Conliniiecl on page 46
Attention] . . .
Drive-in IVIanagers.
Don't let the rain stop your
profitable concession sales.
Sell DRIZZLE GARD'^.
DRIZZLE CARD ram visor keeps your customers on the lot eating and drinking on
rainy nights, and you make a nice profit on its sales. The patented DRIZZLE GARD
has been a proven profit producer for over 15 years.
DRI-VIEW MANUFACTURING CO.
p. 0, Box 4284 • 915 East Kentucky St • Louisville, Ky. 40204 • Phone: (502) 636-5158
BOXOFFICE :: August 2. 1976 45