CHI Financial Accounting in Hospitality 2

Question 1

In hospitality accounting, which method records revenue when a guest checks out rather than when payment is received?

Accepted Answer

Accrual basis accounting

Answer

Accrual basis accounting records revenue when it is earned (at checkout) rather than when cash is received.

Question 2

A hotel's RevPAR is $85 and its occupancy rate is 68%. What is the Average Daily Rate (ADR)?

Accepted Answer

$125.00

Answer

ADR = RevPAR ÷ Occupancy Rate = $85 ÷ 0.68 = $125.00.

Question 3

Which document summarizes a hotel's assets, liabilities, and owner's equity at a specific point in time?

Accepted Answer

Balance sheet

Answer

The balance sheet (statement of financial position) shows assets, liabilities, and equity at a single date.

Question 4

A restaurant's cost of goods sold is $42,000 and food sales total $120,000. What is the food cost percentage?

Accepted Answer

35.0%

Answer

Food cost percentage = COGS ÷ Sales × 100 = $42,000 ÷ $120,000 × 100 = 35%.

Question 5

In the Uniform System of Accounts for the Lodging Industry (USALI), which department is classified as an undistributed operating expense?

Accepted Answer

Administrative & General

Answer

Under USALI, Administrative & General is an undistributed operating expense that benefits the entire property.

(CHI) Certified Hospitality Instructor Practice Test