Basic Royalty Computations
A few years ago, the division of proceeds between the artist and the record company was very intricate and kinda tricky. Fortunately, most companies already switched to a much simpler system.
To follow this next part, we will need to use a little math.
The artist royalty is a percentage of the wholesale price. The companies also call this price the published price to dealers, or mostly outside the U.S., the base price to dealers. Each royalty percentage is known as a point. So if you have a 10% royalty, you have 10 points. You multiply your royalty percentage times the wholesale price to find out your cut.
Here is an example.
Wholesale price: $10
Royalty rate: x 10% (x 0,1)
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