Analyze how department revenues and expenses affect the lodging's profit margin.

Analysis should include describing the lodging's major departments and summarizing the role each plays in profitability.

Process/Skill Questions:

• How is a profit margin calculated?
• What is the average gross profit margin for a hotel?
• What are sources of revenue for hotels?
• How does each department's profitability affect the lodging's overall profit margin?
• Why are budgets created for each department?
• What actions are normally taken to correct or improve the financial operations of a department or property?
• How can a hotel maintain profitability through tough economic times?