UNIVERSITI TEKNOLOGI MARA

FINAL EXAMINATION

NAME: MUHAMMAD FIRDAUS BIN ISMAIL

STUDENT ID: 2021944751
GROUP: NHMA5A
SUBJECT: HTH578 HOSPITALITY FINANCIAL PERFORMANCE
AND ANALYSIS
EXAMINATION: JULY 2022
1) White Sand Resort
CASH BUDGET FOR MARCH, APRIL, AND MAY

DETAILS MAR APR MAY

Opening Balance 10150 28456 64228
CASH RECEIPTS
Cash Receipts from Sales
Cash Sales 20308 19998 21096

Credit Sales
30% next month 36396 30462 29997
50% the following 2 month 55235 60660 50770
TOTAL CASH RECEIPTS FROM SALES 111939 111120 101863
Cash Receipts Financing:
Disposable of Assets

Other Receipts:
Rental Received
Commission Received
Dividend/Interest
Sales of Equipments 14800
TOTAL CASH RECEIPTS FINANCING 0 14800 0
TOTAL CASH AVAILABLE 122089 154376 166091

CASH DISBURSEMENTS
Cash of Sales
Cash Purchase
40% DARI 50% SALES REVENUE 16246 15998 16877

Credit Purchase
60% next month 29117 24370 23998
45363 40368 40874

Operations:
Payroll Expense 18000 19800 20400
Rent Expense 12000
Utilities Expense 3220 4330 5440
Insurance
Other Operating Cost 6600 7700 8800
Interest 3800 3800 3800
TOTAL CASH FOR OPERATION 43620 35630 38440
Financing:
Loan Repayment 4650 4650 4650
New Equipments 20000
Semi Annual Bonus 9500
TOTAL CASH FOR FINANCING 4650 14150 24650
TOTAL CASH DISBURSTMENT 93633 90148 103964
ENDING CASH BALANCE 28456 64228 62126
2) Galaxy Hotel
A) Payback Period

Capital RM2,400,000
Projection 5 years

Year Palm Tree Hotel Cumulative CF Year Coconut Tree Hotel Cumulative CF
1 515,742 1 715,345
2 642,310 1,158,052 2 641,255 1,356,600
3 715,642 1,873,694 3 744,642 2,101,242
4 817,649 2,691,343 4 812,611 2,913,853
5 933,240 5 541,008

Year 't' + Capital - Total Cash Flow 't'

Cash Flow after year 't'

3+ (2400000 - 1873694) 3+ (2400000 - 2101241)

817,649 812,611

3.64 years 3.37 years

*Decision: Choose project that offers shorter payback period.

Decision: The company should take Coconut Tree Hotel because they offers
shorter payback period
B) Net Present Value

Capital RM2,400,000
Projection 5 years
Present Value Interest Factor = Discount Rate
Year Palm Tree Hotel PVIF i = 15% Present Value (CF x PVIF)
1 515,742 0.870 448696
2 642,310 0.756 485586
3 715,642 0.658 470892
4 817,649 0.572 467695
5 933,240 0.497 463820
Total Present Value 2336690
Less: Capital 2400000
Net Present Value -63310

Year Coconut Tree Hotel PVIF i = 15% Present Value (CF x PVIF)
1 715,345 0.870 622350
2 641,255 0.756 484789
3 744,642 0.658 489974
4 812,611 0.572 464813
5 541,008 0.497 268881
Total Present Value 2330807
Less: Capital 2400000
Net Present Value -69193

Decision:
i) Take the highest Net Present Value (NPV)
ii) If both NPV negative, reject both.

Decision:
The company should not take any companies because it gives a negative NPV.

C) COMPARE TO BOTH HOTEL, GALAXY HOTEL SHOULD NOT BUY ANY

HOTEL BECAUSE BOTH HOTEL SHOWN NEGATIVE NET PRESENT
VALUE (NPV).
3 RESTAURANT
A) CALCULATE AVERAGE CHECK AND AVERAGE COST
AVERAGE CHECK
Month SALES REVENUE GUEST AVERAGE CHECK
1 162,400 21,100 7.70
2 178,600 22,800 7.83
3 205,600 23,200 8.86
4 235,100 24,500 9.60
5 247,400 25,900 9.55

AVERAGE COST
Month COST OF SALES GUEST AVERAGE COST
1 47,200 21,100 2.24
2 59,300 22,800 2.60
3 81,600 23,200 3.52
4 94,000 24,500 3.84
5 103,100 25,900 3.98

B) PREPARE THE TREND INDEX USING (i) FOR REVENUE COST

TREND INDEX REVENUE
Month Average Check Trend Index
1 7.70 100
2 7.83 102
3 8.86 115
4 9.60 125
5 9.55 124

TREND INDEX COST

Month Average Cost Trend Index
1 2.24 100
2 2.60 116
3 3.52 157
4 3.84 171
5 3.98 178

C) CONVERT THE HISTORIC DOLLAR TO CURRENT DOLLAR USING (iii) FOR SALES REVENUE AND COST
SALES REVENUE CONVERT TO CURRENT DOLLAR
Month Sales Revenue Trend Index Current Dollar
1 162,400 100 201376
2 178,600 102 217122
3 205,600 115 221690
4 235,100 125 233219
5 247,400 124 247400
 COST CONVERT TO CURRENT DOLLAR
Month Cost OF Sales Trend Index Current Dollar
1 47,200 100 84016
2 59,300 116 90995
3 81,600 157 92515
4 94,000 171 97848
5 103,100 178 103100

Comments: Our completed trend index results show us that the sales revenue and cost of food sales have been
increasing. Expressed another way, Sales Revenue is up 24 percent (124-100) and the cost of food sales is up 78
percent (178-100). This is normally an undesirable trend that should be investigated and possibly corrected.
4) HOT SPRING HOMESTAY
A) Current Ratio = 2021 2020 2019

= 2.80 2.60 3.2

= 2.8:1 2.6:1 3.2:1

Explanation
For every RM1 Current Liability, the company has RM2.8 Current Assets to settle the
Current Liability. As compared to the previous year, the company performs better than the
year 2020 (2.8>2.6), meanwhile if compared to 2019 the company did not perform well
(2.8<3.2).

Quick Ratio = 2021 2020 2019

= 0.70 1.0 1.1

= 0.70:1 1.0:1 1.1:1

Explanation
For every RM1 Current Liability, the company has RM0.70 Quick Assets to settle the
Current Liability. As compared to the previous year, the company's performance is bad
compared to the years 2020 and 2019 (0.70 < 1.0) (0.70<1.1) respectively.

Debt to total
= 2021 2020 2019
asset

= 40% 20% 25%

Explanation
For every RM1 Sales Revenue, the company allows 0.40 cents Credit Sales. As compared
to the previous year the company performs bad than in the years 2020 and 2019 (40% >
20%) (40%>25) respectively.

Inventory
= 2021 2020 2019
Turnover

= 6.5 times 5.8 times 5.7 times

Explanation
The company is able to permit 6.5 times Credit Sales based on the present level of Credit
Sales. As compared to the previous year the company performed better than in the years
2020 and 2019 (6.5>5.8) (6.5>5.7) respectively.

Average
Collection = 2021 2020 2019
Period

= 29 Days 36 Days 45 Days

 Explanation
The company needs 29 days gap to collect its debts. As compared to the previous year the
company performs way better than in the years 2020 and 2019 (29<36) (29<45)
respectively.
Total Asset
= 2021 2020 2019
Turnover

= 2.9 times 3.6 times 4.2 times

Explanation
The company is able to permit 2.9 times Credit Sales based on the present level of Credit
Sales. As compared to the previous year the company performed better than in the years
2020 and 2019 (2.9<3.6) (2.9<4.2) respectively.
Net Profit
Margin = 2021 2020 2019

= 25% 25% 18%

Explanation
For every RM1 asset, the company generates 25 cents in net income. As compared to the
previous year the company's performance is consistent on 2020 and for 2019 the
company's performance is way better (25%>18%).

Return On
Investment = 2021 2020 2019
(ROI)

= 12.2% 12.0% 12.1%

Explanation
For every RM1 asset, the company generates RM12.2 Sales Revenue. As compared to the
previous year the company performs better than in the years 2020 and 2019 (12.2>12)
(12.2>12.1) respectively.

Return on
= 2021 2020 2019
Equity (ROE)

= 14.8% 9.7% 14.1%

Explanation
For every RM1 Equity, the company generates 14.8 cents in net income. As compared to
the previous year the company's performance is better than in the years 2020 and 2019
(14.8%>9.7%) (14.8%>14.1%) respectively.

Overall Conclusion:
B)
Overall, the company has a strong financial performance. Most of the ratios recorded better performance
than the previous year. The company is efficient in generating profits from sales revenue and available
assets.