Rooms - Chapter 4

Question 1

average daily rate

Answer 1

An occupancy ratio derived by dividing net rooms revenue by the number of rooms sold.

Question 2

average rate per guest

Answer 2

An occupancy ratio derived by dividing net rooms revenue by the number of guests.

Question 3

competitive set

Answer 3

The group of hotels in a market that provide the most important competition for a hotel.

Question 4

daily report of operations

Answer 4

A report that summarizes the hotel’s financial activities during a 24-hour period and provides insight into revenues, receivables, operating statistics, and cash transactions related to the front office; also known as the manager’s report.

Question 5

forecasting

Answer 5

The process of predicting events and trends in business; typical forecasting for the rooms division includes room availability and occupancy.

Question 6

house count

Answer 6

The forecasted or expected number of guests for a particular period, sometimes broken down into group and non-group business.

Question 7

Hubbart Formula

Answer 7

A bottom-up approach to pricing rooms; in determining the average price per room, this approach considers costs, desired profits, and expected rooms sold.

Question 8

income statement

Answer 8

A financial statement that provides important information about the results of hotel operations for a given period of time.

Question 9

market condition approach

Answer 9

An approach to pricing that bases prices on what comparable hotels in the hotel’s competitive set are charging for a similar product.

Question 10

multiple occupancy percentage

Answer 10

The number of rooms occupied by more than one guest divided by the number of rooms occupied by guests.

Question 11

multiple occupancy ratio

Answer 11

A measurement used to forecast food and beverage revenue, indicate clean linen requirements, and analyze daily revenue rate; derived from the multiple occupancy percentage or by determining the average number of guests per rooms sold; also called the double occupancy ratio.

Question 12

occupancy percentage

Answer 12

An occupancy ratio that relates the number of rooms sold to rooms available for sale during a specific period of time.

Question 13

occupancy ratios

Answer 13

A measurement of the hotel’s success in selling rooms; typical occupancy ratios include average daily rate, revenue per available room, average rate per guest, multiple occupancy statistics, and occupancy percentage.

Question 14

operating ratios

Answer 14

A group of ratios that assist in the analysis of hospitality operations.

Question 15

overstay

Answer 15

A guest who stays after his or her stated departure date.

Question 16

rack rate

Answer 16

The standard rate the property establishes for a particular category of rooms.

Question 17

revenue per available customer (RevPAC)

Answer 17

A revenue management measurement that focuses on revenue per actual guest.

Question 18

revenue per available room (RevPAR)

Answer 18

A revenue management measurement that focuses on revenue per available room.

Question 19

room rate variance report

Answer 19

A report listing rooms that have not been sold at rack rates.

Question 20

rule-of-thumb approach

Answer 20

A cost approach to pricing rooms in which the room rate is set at $1 for each $1,000 of construction and furnishings cost per room, assuming an occupancy of 70 percent.

Question 21

stayover

Answer 21

A room status term indicating that the guest is not checking out today and will remain at least one more night; a guest who continues to occupy a room from the time of arrival to the stated date of departure.

Question 22

understay

Answer 22

A guest who checks out before his or her stated departure date.

Question 23

yield statistic

Answer 23

The ratio of actual rooms revenue to potential rooms revenue.