Why does the hotel expect only a small percentage

Assignment Help Managerial Accounting

Reference no: EM133342159

Case: Crumbling Resort Hotel has a dining room that gets all its business revenue from the people occupying rooms in the hotel. The hotel has 200 rooms. During the month of July, 2023, hotel management expects an occupancy rate of 88%; since Crumbling Resort is a family-oriented place, there will be on average 3 people in each occupied room per night.

Based on knowledge of past years, Crumbling's management knows that 90% of their hotel guests eat breakfast in the hotel dining room, 30% eat lunch there and 75% eat dinner there. The dining room serves three meals a day, seven days a week. Average meal prices are:

Breakfast:      $ 10.80
Lunch:            19.50
Dinner:           32.70
Total:              $ 63.00

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REQUIRED:

Why does the hotel expect only a small percentage of its guests to eat lunch there?
Carefully showing your work, please calculate the total revenue that the dining room should earn during the month of July, 2023.
If the dining room at Crumbling Resort spends 30% of its revenue on food costs, how much money will remain, that can be contributed towards fixed costs by the end of July, 2023, based entirely on revenues earned in that month?

Reference no: EM133342159

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