Question: Boston Celtics Limited Partnership II and
Boston Celtics Limited Partnership II and Subsidiaries presented the following consolidated
statements of income for 1998, 1997, and 1996.
Required
a. Comment on Amortization of NBA Franchise and Other Intangible Assets.
b. Would the discontinued operations be included in projecting the future? Comment.
c. The costs and expenses include team costs and expenses. Speculate on the major reason for the increase in this expense between 1996 and 1997.
d. What were the major reasons for the increase in income from continuing operations between 1997 and 1998?
e. Speculate on why distributions declared were higher in 1998 than 1996. (Notice that net income was substantially higher in 1996.)
Transcribed Image Text:
BOSTON CELTICS LIMITED PARTNERSHIP II AND SUBSIDIARIES CONSOLIDA TED STATEMENTS OF INCOME For the Year Ended June 30, 1998 June 30, 1997 June 30, 1996 Revenues: Basketball regular season Ticket sales Television and radio broadcast rights fees Other, principally promotional advertising Costs and expenses: Basketball regular season $39,107,960 28,002,469 8,569,485 75,679,914 $31,813,019 23,269,159 7,915,626 62,997,804 $35,249,625 22,071,992 7,458,651 64,780,268 40,401,643 2,820,107 13,464,566 4,819,478 208,162 Team 40,941,156 2,386,042 13,913,893 4,680,168 189,324 27,891,264 2,606,218 15,053,333 2,973,488 140,894 Game General and administrative Selling and promotional Depreciation Amortization of NBA franchise and other intangible assets 165,035 61,878,991 13,800,923 (6,017,737) 6,402,366 164,702 62,275,285 722,519 (5,872,805) 6,609,541 164,703 48,829,900 15,950,368 (6,387,598) 8,175,184 Interest expense Interest income Net realized gains (losses) on dis position of marketable securities and other short-term investments (18,235) 361,051 (101,138) Income from continuing operations before income taxes Provision for income taxes Income from continuing operations 14,167,317 1,900,000 12,267,317 1,820,306 1,400,000 420,306 17,636,816 1,850,000 15,786,816 (continued)
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