Accounting and Financial Analysis in the Hospitality Industry

Preface......Page 10
Foreword......Page 14
1 Introduction to Numbers, Accounting, and Financial Analysis......Page 15
Numbers: The Lifeblood of Business......Page 17
Career Success Model......Page 20
The Three Main Financial Statements......Page 23
Revenues: The Beginning of Financial Performance......Page 29
Profit: The Ultimate Measure of Financial Performance......Page 34
Summary......Page 37
Key Terms......Page 38
Formulas......Page 39
Review Questions......Page 40
2 Foundations of Financial Analysis......Page 41
Methods of Financial Analysis......Page 42
Comparing Numbers to Give Them Meaning......Page 44
Measuring Change to Explain Performance......Page 46
Using Percentages in Financial Analysis......Page 48
Four Types of Percentages Used in Financial Analysis......Page 49
Trends in Financial Analysis......Page 53
Summary......Page 55
Key Terms......Page 56
Problems......Page 57
3 Accounting Department Organization and Operations......Page 61
Organization Charts......Page 62
Accounting Operations in Full-Service Hotels......Page 71
Accounting Operations in Restaurants and Smaller Hotels......Page 76
Summary......Page 78
Key Terms......Page 79
Review Questions......Page 80
4 The Profit and Loss (P&L) Statement......Page 81
Hotel Consolidated P&L Statements......Page 83
Formats for a Consolidated P&L......Page 89
Department P&L Statements......Page 96
Summary......Page 98
Hospitality Manager Takeaways......Page 99
Key Terms......Page 100
Review Questions......Page 101
5 The Balance Sheet (A&L) and Statement of Cash Flow......Page 103
The Balance Sheet or Asset and Liability (A&L) Statement......Page 104
Working Relationships between the Balance Sheet and the P&L Statement......Page 113
The Statement of Cash Flow......Page 115
Summary......Page 121
Key Terms......Page 122
Review Questions......Page 123
6 Hotel Management Reports......Page 125
Internal Hotel Management Reports......Page 126
Daily Reports......Page 127
Weekly Internal Management Reports......Page 139
Monthly Internal Management Reports......Page 141
Summary......Page 145
Key Terms......Page 146
Review Questions......Page 147
7 Revenue Management......Page 149
REVPAR: Revenue per Available Room......Page 150
Rate Structures and Market Segments......Page 155
Revenue Management Systems......Page 157
Selling Strategies......Page 161
Summary......Page 163
Key Terms......Page 164
Review Questions......Page 165
8 Comparison Reports and Financial Analysis......Page 167
Profitability: The Best Measure of Financial Performance......Page 168
Review of Chapter 2: Foundations of Financial Analysis......Page 173
Variation Analysis......Page 175
STAR Market Report......Page 181
Hospitality Manager Takeaways......Page 184
Review Questions......Page 185
9 Forecasting: A Very Important Management Tool......Page 187
Forecasting Fundamentals......Page 189
Types and Uses of Forecasts......Page 190
Revenue Forecasting......Page 196
Wage Forecasting and Scheduling......Page 198
Summary......Page 199
Key Terms......Page 200
Problems......Page 201
10 Budgets......Page 243
The Use of Budgets in Business Operations......Page 244
Annual Operating Budgets......Page 248
Formulas and Steps in Preparing a Budget......Page 250
Capital Expenditure Budgets......Page 254
Hospitality Manager Takeaways......Page 257
Review Questions......Page 258
Problems......Page 259
11 Corporate Annual Reports......Page 263
The Purpose of Corporate Annual Reports......Page 265
The Message to Shareholders......Page 268
The Content of the Corporate Annual Report......Page 271
Financial Results for the Year......Page 275
Summary......Page 276
Key Terms......Page 277
Review Questions......Page 278
12 Personal Financial Literacy......Page 279
Personal Financial Literacy......Page 280
Managing Personal Finances......Page 285
Evaluating Assets and Sources of Income......Page 288
Summary......Page 290
Key Terms......Page 291
Review Questions......Page 292
Glossary......Page 293
Index......Page 301