Sport Finance Fina;

vertical equity

Concerned with the taxpayer's ability to pay, typically calling for a tax that does not cause poorer persons to bear a disproportionate share.

T or False: Compound interest is calculates only on principal

False

T or F Forecasting is the process of defining a vision for your organization and creating goals and objectives to help achieve this vision.

False, it is predicting what is going to happen

Historically, which bond was the most common method used for facility financing?

General obligation bonds, these are backed by the government

For all sport and entertainment organizations, __________ financing may include land use, tax abatements (you don't have to pay taxes, or a reduction), direct facility financing, and infrastructure improvements (building roads).

Government

Explain the difference between nominal value and real value

Nominal is the face value of money. Real is the purchase power of the dollar, changes due to inflation

Which of the following is a single cash flow per year forever into the future?

Perpetuity

Explain the difference between each of the following wealth maximization/profit principles.

•Accounting profit: revenue exceeds the cost •Economic profit: profit remaining after opportunity costs (best measure of economic balance) Opportunitycosts: Cost of what you didn't choose

This type of financing includes charitable donations, either cash or in-kind, made to an organization and is the primary source or operating and investing income for major collegiate sports programs.

A gift

For Division I-FBS Group of 5 conferences, increased revenue depends on what?

Preforming in the NCAA mens basketball tourney, conference football championship, 12 football teams playing in the conference

Which of the following is today's value of a future cash flow?

Present Value

Which type of bond is a form of public finance paid off solely from specific, well-defined sources such as hotel taxes, ticket taxes, or other sources of public funding?

Revenue Bonds

Benefit principle

User pays principle, states that those who benefit from a particular project ought to be the ones taxed. For funding a stadium, a ticket tax on sporting events would satisfy the benefit principle much more than a cigarette tax.

Which of the following is a picture or snapshot of the financial condition of an organization at a specific point in time? a.Balance sheet

A balance sheet

As a part of a feasibility study, ____________ directly investigates actual facilities that might compete with a subject facility in order to host events

A competitive analysis

What factors are driving up the operating costs of an university athletic department

Arms race, moving up a division, free market for college coaches, increasing tuition on college campuses

Which of the following budgets allows the management to forecast future requirements related to property, facilities and major equipment?

Capital expenditure budget

When an organization borrows money that must be paid back over time, usually with interest, what kind of financing is being used?

Debt

The choices that individuals and organizations make regarding financial management are influenced by what?

Demand, scarcity and price

Which is a measure of risk or uncertainty of time?

Discount Rate

T or F The revenues that member schools receive from conference distributions are the largest percentage of overall departmental revenues

False

T or F The sale of naming rights has little to do with getting a new stadium financed and completed

False

The __________ shows the organization's income over a specified period of time.

Income Statement

Last year's budget is increased or decreased by a percentage using this method of budgeting

Incremental bugeting

What are the main parts of a feasibility study?

Market demand, economic and fiscal impact, financing, location, construction costs and engineering

Which section of the feasibility study drives much of the rest of the study

Market demand, if there is no demand, there is nothing else

When sport leagues do not expand into a market that can support a franchise, or when they create rules to limit the movement of existing franchises, which of the following economic concepts is being applied?

Scarcity

Which financial statement tracks cash in and cash out of an organization over a specified period of time?

Statement of cash flows

Horizontal equity

Suggests that individuals with similar incomes should pay similar amounts of a tax.

T or F Each of the professional sport leagues has established rules regarding who may become an owner and join their "club."

T

What are the primary sources of NCAA revenues

Television and marketing rights fees

T or F Psychic impact is the emotional impact of having a local sports team

True

T or F Sports facilities compete against one another for corporate dollars

True

T or F The NBA and NHL do not share revenues generated from gate receipts

True

T or F The age of the population is another factor when analyzing ticket demand in comparable

True

T or F When using the ledger of T-accounts, credits are entered on the right-hand side and debits are entered on the left-hand side.

True

T or F revenues from league sponsorship deals are shared equally

True

T or F: The sports industry relies on the discretionary income of spectators and participants

True

When a team has signed multiyear contracts to receive money, these revenue sources can be used as a collateral to get loans. This is referred to as ________________.

contractually obligated income