Cost Sheet format for Hotel Organization:

------------ Hotel Limited

Cost Sheet for the month of ------------------------

Days Operated/Rooms Occupied:

Particulars Amount Amount Per

(Rs.) room
1) Salaries to staff
2) Salaries of room attendants
3) Laundry expenses
3) Electricity charges
4) Repairs and maintenance
5) Interior and tapestry
6) Sundry expenses
7) Depreciation
8) Interest
9) Rent
10) Administration charges
Total Cost
Cost Per Room Day
Add: Profit
Rent per room day
Fixed Costs and Variable Costs in hotels

The terms Variable costs and fixed costs in hotel operation is used to distinguish between those costs that
have direct relationship to Hotel occupancy and those that has no relation to occupancy and business .

Fixed Costs: Fixed costs are normally not effected by changes in occupancy or sales volume. They are said
to have little direct relationship to the business volume because they do not change significantly when the
number of sales increases or decreases.

The term fixed should never be taken to mean static or unchanging,but merely to indicate that any changes
that may occur in such costs are related only indirectly or distantly to changes in volume.

Examples of Fixed costs are:

 Land, Building Taxes to government.

 Wages to employees.

 Hotel employees health premium.

 Out sourced services contracted for fixed amount in a month eg:- security services.

 Yearly maintenance contract fees ( AMC ) for all equipments, machineries and Hotel Management
software's.

 Fixed internet, telephone plans.

 Advertising cost.

 Yearly external auditing cost.

 Payroll.

 Provision.

 In house moves / satellite TV.

 Music entertainment.

 Reservation expenses.

 Subscription - Newspaper, magazine etc.

 Human resources.
  Sales & marketing.

 Interest on loan.

 Other fixed charges etc.

Variable Costs: Variable costs are clearly related to hotel occupancy and business volume. As business
volume or occupancy increases, variable costs will increase; as hotel occupancy decreases, variable costs
should decrease as well.

Examples of variable costs are:

 Food, beverages, house keeping cleaning supplies.

 Flower arrangements.

 Guest room amenities.

 Guest room, restaurants and banquets linen.

 Banquet HVAC costs.

 Stationeries used in Front desk and restaurants.

 Chemicals for laundry and water treatment plants.

 T/A commission.

 Flower & decorations.

 Guest supplies -amenities.

 Guest relations.

 Laundry operations.

 Laundry Uniform.

 Printing supplies.

 Entertainment.

 Telephone & Fax.

 Transportation.

 Other operating supplies.

 Administration & General.

 Human resources.

 Sales & Marketing.

 Management Fees etc.

From the following information relating to a hotel, calculate the room rent to be charged to give a profit of
25% on cost excluding interest charged on loan for the year ended 31st March, 2008:

1. Salaries of office staff Rs 50,000 per month.

2. Wages of the room attendant: Rs 20 per day per room when the room is occupied.
3. Light, heating and power:
a. The normal lighting expenses for a room for the full month is Rs 500, when occupied.
b. Power is used only in winter and charges are Rs 200 for a room, when occupied.
5. Repair to bed and other furniture: Rs 30,000 per annum.
4. Repair to Hotel building: Rs 50,000 per annum.
4. License fees: Rs 12,400 per annum.
7. Sundries: Rs 10,000 per annum.
8. Interior decoration and furniture: Rs 1, 00,000 per annum.
9. Depreciation @ 5% p.a. is to be charged on building costing Rs 20,000 and @ 10% p.a. on equipments.
10. There are 200 rooms in the Hotel, 80% of the rooms are generally occupied in summer, 60% in winter,
30% in rainy season.
The period of summer, winter and rainy season may be considered to be of 4 months in each case. A month
may be assumed as 30 days of an average.