Accept the Meeting Item Decline the Meeting Calculation of Rooms Revenue Rooms Occupied (A) A Using the information you were given Average Rate (B) B Complete this form to calculate the impact of displacing the transient potential. Room Revenue (A X B) C Do NOT enter data into shaded cells Use the formulas given in column A and referenced in column B Calculation of F&B Revenue Rooms Occupied (A) A Revenue Per Occupied Room (D) D Gross Revenue (A X D) E Revenues: Room Revenue Food and Beverage Revenue C E Additional AV Revenue Gven Loss of Tennis Revenue (negative number) Given Loss of Parking Revenue (negative number) Given Total Gross Revenue Note: Enter as a NEGATIVE number Note: Enter as a NEGATIVE number Q $0 Rooms Variable Cost ($30 Per Room night (A) F $0 Banquet Food Cost (25% x E) G Restaurant Food Cost (33% x E) H $0 Incremental Expenses: Banquet Labor Cost (24% x E) I Restaurant Labor Cost (30% x E) J Meeting Planner Commission (10% of Room Revenue) K A/V Cost (50%) (X AV Revenue) M Note: Enter as a NEGATIVE number Savings in Tennis Labor (Given in Case - Negative Number) N Cost of Erecting Tent (Given in Case) Total Incremental Costs O P $0 $0 Q-P $0 $0 When you are done, save this form as "firstnamedisplace.xlsx" and submit using the assignment link. Net Differential Profit

HOSP 3077 Accept or Decline Business Exercise 1. A group desires to book a meeting of 600 rooms per night for four nights. 2. The month they require the rooms is July, which is the peak summer season for the hotel. 3. The meeting planner for the convention group is offering a $150 room rate and is requiring the hotel to pay her a 10% commission on the gross room revenue. 4. The transient rate is forecast to be $180 over this period. 5. It is estimated that the room nights for the meeting guests will displace 2,200 forecasted transient room nights. 6. Variable costs per occupied room are $30, regardless of the guest (transient or group). 7. The food and beverage revenue generated through banquet services will displace revenues in the restaurants. It is estimated that the banquet food and beverage revenue will amount to $100 per group room night, while the displaced transient revenue will amount to $80 per transient room night. 8. The banquet food cost is 25%, while restaurant food cost is 33%. 9. The labor percentage in banquets is 24%, while in the restaurant it is 30%. 10. The property’s audiovisual (AV) department will generate an additional $50,000 in revenue from the convention. The related costs are 50%. 11. The meeting planner wants to erect a tent on the tennis courts at a cost of $50,000, to be paid by the hotel. 12. Loss of tennis revenue for these days (including setup and teardown) will amount to approximately $3,000. There will be a corresponding savings in labor of $400 for the six days (entire, not per day). 13. Parking revenues will be reduced by an estimated $2,500 as most attendees will fly in rather than drive. 14. There will be no change in fixed costs or any other changes in variable cost. Given the facts above, complete the analysis on Excel file you were provided. Also, indicate whether you would accept or decline the group. Accept Decline