To be fair, the record label profit is more like 1/3 of the revenue, not 100%. Still, compared to 10-15% less every expense imaginable, they make out far better (even on "unrecouped" bands) than the artists.
Well they definitely can't make 100% of the revenues since they do incur expenses. What I'm saying is that in order for the band to make enough money to payback the loan, their music would have to gross $4,000,000 in profits. I'm assuming that the band receives 10% of all profits from sales. So $400,000 / 0.1 would be $4,000,000 going to the record companies (3.6 mill they pay themselves, and the other .4 is the repayment from the band). I know this is an oversimplification of the process but I'm simply emphasizing the corrupt nature of the labels here.
