Did Your Play or Musical Actually Make Money?

Strike is done. The set is broken down, the borrowed furniture is back where it came from, and you've got a folder of box office reports and a stack of receipts sitting on your desk.

Now is the time to crunch some numbers! The key calculation is not (necessarily) the number of attendees printed at the bottom. It's the profit the show itself made and how accurate your budget projections were. Let's talk through how to calculate your profit and variance.

Did the show make money?

Subtract what the production actually spent from what it actually took in. If the number is positive, the show made money. That figure is your profit for the show. 

In a nonprofit the same figure is usually called surplus. It means the same thing: the money that is left over. A community theater usually keeps it. A public school program often cannot.

Why do accurate projections matter if the profit looks right?

At the end of the day it only matters that you made money, right? Well.... only kind-of. If you want to keep making a profit and producing shows there is a second important calculation to make.... projection variance.

For example, you estimated $1000 for the ticket income line and that came in lower but a patron line that came in high which means your total projection was very close to your actuals, but a total landing close doesn't help you project the next show. The individual expense and income lines are where that key information is.

Ticket income missed by $1,197 and sponsorship by $500. The profit was only off by $192.

The gap between a projected figure and an actual one is the variance on that line. A variance is not a mistake. It is a measurement, and one you can keep getting better at.

How do you read the variance, line by line?

Set the two columns, projected and actuals, beside each other and work down. The whole exercise is five passes, and all of it can be done in a spreadsheet with simple formulas.

1. Copy the projected column exactly as you built it. Same line names, same order. If the actual column has lines the budget didn't, the budget was missing lines and that is worth knowing for next time.
2. Fill in what actually happened, from receipts and box office reports. Not from memory, and not from the running total somebody kept in their head during tech week.
3. Work out the gap on every line. Including the ones that came in exactly on target — a line that didn't move is a line you now know how to project.
4. Split the gaps that matter into price and volume. This is the pass that pays. Ticket income can fall because fewer people came, or because the same number of people paid less each. Those are two different problems with two different answers, and the ticket line shows you one number.
5. Write the cause beside each gap now, while you remember it. Six months on, "sound, +$360" means nothing. "Sound, +$360, two body packs died in week one" means you know to rent a spare next show. 

You can track this as you go. Some expense lines were settled before the house opened and could not move — program ads are invoiced before you print, and the royalty was quoted and agreed. Ticket income, concessions and anything bought during tech were still moving and are likely better calculated after the show opens.

What did that look like at our example show, Cedar Valley?

Cedar Valley Community Theatre runs a 250-seat house, six performances, at $18 general and $15 for students and seniors. Their projected numbers come from the two earlier posts in this series — what the two shows cost and where the income was going to come from. Both shows have now closed.

Much Ado About Nothing — the show that went fine

Word of mouth was good and the last weekend sold out. Fill — the share of available seats that had a body in them — came in at 64% against a projected 60%.

A public-domain title with no royalty, in a building you own, is a forgiving budget. There is not much to read here. That is a good result, and the musical is where the reading happens.

The musical — the show that looked exactly right

Projected profit $4,220. Actual profit $4,028. A gap of $192 on a $20,000 production, which on the bottom line alone reads as a budget that worked.

Four things happened, and the total shows none of them.

1. The house was "softer" (the fancy insider word for less well attended than expected) and the mix changed underneath it. House attendance, or fill, came in at 76% against a projected 80%, which is 60 fewer bodies. But the split between full-price and discounted tickets also moved, from 75/25 to 70/30 — a school-heavy musical draws students. So the room was emptier and the average ticket was cheaper, and the ticket line reports one number for both. Splitting it is step 4, and it is the difference between "market it harder" and "price it differently."

Comps sit inside that. Cedar Valley gives away 10 seats a night — tickets handed out rather than sold — and that count holds steady when the house softens, so 60 comps out of 1,140 is a slightly bigger bite than 60 out of 1,200. Comps are a useful tool; they just don't shrink alongside everything else.

2. A sponsor pledged and never paid. One gold sponsor at $500. This is the reason for tracking pledged and paid as two separate columns rather than one — pledged money is a forecast, and it becomes income on the day it clears.

3. Two expense lines went way over budget and the contingency absorbed them. Scenery went over by $450 for a platform that had to be rebuilt, sound by $360 for replacement body packs. Together that is $810 against $1,865 of contingency, so the show came in under budget overall.

4. That last one is what makes variance reports confusing. Contingency is never spent as contingency. It gets spent as scenery and as sound. If you go looking for it as its own line you will find zero and conclude you didn't need it, when in fact it did its whole job.

A bonus: The deposit came back. The books went home unmarked, so the $200 returned — a line that was always going to resolve to zero and still had to be carried, because the cash had to be in hand long before opening.

The honest summary of the musical is that it earned about $4,000 and was never as safe as the bottom line suggests because our projections could be more accurate. Ticket income alone was $572 short of covering the show. It got there on ads, sponsorship, concessions and patron listings.

Where does the money go, and who should see a final show budget report?

This is the point where a community theater and a school drama program stop having the same process. The arithmetic above is identical for both. What differs is which account the money sits in, who must see these numbers, and whether a profit survives to next season.

If you're an independent nonprofit

The profit stays in the company's account and the board sees the final report. Your annual IRS filing is set by size: organizations with gross receipts normally at or under $50,000 file the Form 990-N e-Postcard, and under $200,000 in receipts with under $500,000 in assets you file the 990-EZ. Above that it's the full 990.

Cedar Valley's two shows together bring in about $43,000, which puts a two-show company just under the postcard line — a third production moves them into a real return.

What none of those forms do is tell you how one show did. They report a whole year, split into program, management and fundraising, which are categories built for a donor reading from outside. Reporting income and expense per production is a separate internal practice, and a recognized one in nonprofit accounting rather than something you are inventing.

If you're a public U.S. school program

The money is in an activity fund and the rules are not yours to set. The national reference is the U.S. Department of Education's handbook on activity fund accounting, which draws the line that matters: student activity funds belong to the students and support student organizations, while district activity funds belong to the district. Which one holds your ticket money is decided by purpose, and it determines who can approve spending it.

The handbook also already specifies the reporting, which changes the job considerably. The activity fund bookkeeper prepares a monthly statement of receipts and disbursements for each organization, and the sponsor — that's you — compares it against their own records and resolves anything that disagrees. So your task at the end of a run is not to invent a report. It is to be able to reconcile against the bookkeeper's, which is a much smaller job if you have kept the actual column as you went.

One caution, because guidance on this ages badly. A 2020 change in government accounting standards (GASB Statement 84) altered how districts classify activity funds, and states did not land in the same place — some moved student activity funds into general district reporting, and others concluded they remain held on the students' behalf. Both are correct applications of the same national standard. So there is no single answer to "where does our show money sit," and the person who knows is your building bookkeeper or district business manager. That is one email.

And other possibilities

Those two structures cover most readers and not all. For everyone else the same opening question works: who holds the account, and what statement do they already produce?

• A private school. The public-district rules above don't apply. The money sits in the school's own accounts, the school is often its own nonprofit, and the report goes to a business office rather than a district. Whether a profit carries into next season is a policy the school sets, and someone there can tell you what it is.
• A school outside the US. None of the specific rules above travel. The reconciling habit does — there is almost always somebody producing a statement your own records should agree with.
• A troupe that isn't an organization yet. If the group isn't registered, the money is in somebody's personal account, and that carries tax questions worth putting to an accountant before the next show rather than after. A separate account and a written understanding of who owns the profit are both cheap to set up early.
• A for-profit company. Then the profit is taxable, and the per-show statement you have just built is the ordinary document of the business. Owners and any investors are the audience.
• A booster club for a school. It is a separate organization, frequently its own nonprofit, often holding money for a program whose activity fund isn't allowed to. A show can genuinely have income in two accounts at once — tickets through the school, concessions and ad sales through the boosters. If that describes yours, the internal report is the only document that puts the whole production in one place.

What goes in the final show budget report?

One page, six parts. The good news is that it isn't a new document — it's the budget you already built, with the actual column filled in and a short note anywhere a line moved.

1. The headline number. Profit, projected beside actual. Put it at the top. It's the first thing anyone reaches for, and everything below it reads better once they have it.
2. Every line, both columns. Income and expense, in the same order as the original budget. Resist the urge to collapse it into totals — the totals are exactly what hid the problem.
3. The variance column. One number per line, over and under both stated plainly. This is the column your board or business office will actually read.
4. A cause beside every line that moved. One clause is enough. "Two body packs died in week one" does more work than a paragraph of explanation.
5. Anything still open. A pledge that hasn't cleared, a deposit not yet back, an invoice you're still waiting on. Name it and say when you expect it to resolve, so nobody reads the number as final when it isn't.
6. What you'd project differently next time. Two or three sentences. Which lines you'd move, and by roughly how much. This is the part that makes the next show's budget better than this one's.

Keep the receipts and box office reports as backup rather than pasting them in — offer them, don't attach them. And save the report somewhere the next producer can find it, because the person who needs it most is whoever does this show in five years.

Common questions

The next time somebody asks whether the company can afford the big musical, there will be plenty of opinions in the room. One person will have last season's real numbers open in front of them.

More production paperwork: the full Theaterish template library.