They’ve just cancelled their upcoming film “Coyote vs. Acme,” and everyone is calling it a tax write-off, just like they did with the cancelled Batgirl film.
Having spent so much on the production of these films, how is it beneficial to them to cancel the film outright? What is a tax write-off in that sense?
In: Economics
Cancelling the film outright means they don’t have to spend any more money on marketing, packaging, distribution. Since they aren’t going to release it, all the money spent on making it so far is pure loss and therefore a write-off.
Say you have a soap business running out of your home. You make a couple dozen different types and you let your kids get involved. One of them is enthusiastic and makes dozens of bars before you get around to QCing them and you realize the soap is hopeless — it smells nasty, leaves a sticky residue, whatever but you realize you’re never going to be able to sell it. Instead of spending more money on bags and labels, you just toss it all in the trash. That’s essentially what WB is doing here — they don’t think they can make money on this film and would rather dump it than spend any more money on it at all.
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