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Scenario 2-3 After It Drew a Record-Low 9.8 Million Viewers in 2004

question 26

Multiple Choice

Scenario 2-3
After it drew a record-low 9.8 million viewers in 2004, ABC dropped the rights to air the Miss America pageant. Six years later, in 2010, ABC once again agreed to air the event after cable network TLC declined to pick up the pageant for a fourth year. Although ABC decided to pick up the pageant for a second time in the last twelve years, the terms of the agreement are far more favorable for the large cable network. Similar to its first stint with the network, the pageant will be shown on Saturday nights (television's lowest viewing night of the week) . The difference this time comes in the price ABC had to pay to acquire rights to the event-because of the recent decline in the event's popularity, the network had to pay very little, and ultimately deemed the deal to be a "no-lose" situation.
-(Scenario 2-3) The pageant's board of directors realizes that holding the event on a Saturday night is detrimental to its success. To supplement the television broadcast, the board contemplates setting up a pageant website and simulcasting the event live over the Internet. What kind of organization or expert might be helpful in planning the webcast?

Definitions:

Endowment Fund

A fund established to finance a particular purpose of an organization, where the principal is kept intact while the investment income is available for use.

Deferral Method

An accounting technique used to delay the recognition of expenses or revenues until the related cash is paid or received.

Financial Statements

Written records that convey the business activities and the financial performance of a company. They typically include the balance sheet, income statement, and statement of cash flows.

Restricted Donations

Donations given to an organization with specific conditions attached regarding how the funds can be used, often designated for a particular purpose or project.