Calculating the financial viability of a hotel

Type :

Term papers

Pages :

9 pages

Format :

.doc

Published date :

08/25/2009

Category :

Economics & finance

Sub category :

Finance

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Summary :

Introductoin
Cost of the project
Building and civil works
Plant and machinery
1. Kitchen equipment
2. Air conditioning plant
3. Power equipoment
4. Generator set
5. Furniure and fixtures
6. Miscellaneous expenses
7. Preliminary and pre operative expenses
Manpower requirement and cost
Sales revenue
Working capital requirement
Financing the project
1. Means of financing
Profitability statements
Break even analysis
Cash flow statement
Ratio analysis
1. Debt service coverage ratio (DSCR)
2. Coverage ratio
Conclusion

Abstract

Tourism industry is one of the fastest growing industries in comparison to other major industries worldwide. The word 'tour' is a Hebrew word derived from the word "torah", which means learning, studying, and research. The Merriam-Webster's dictionary defines 'tour' to mean a journey for business, pleasure, education or other purpose, often involving a circular trip where one returns to the starting point. .

The mobilization of physical and human resources will enable the project to enter the operational phase. One of the important features of the operational phase is that the hotel buys and stores raw materials and uses it for production and maintenance. The raw material undergoes transformation through a working process and results in finished goods and services. The hotel also extends credit to some suppliers and patrons. All of these, taken together, form current assets.