MANAGERIAL ACCOUNT

Parkview Hotel - Managerial Account



Executive summary

The present study is about the hotel Parkview and the strategies use in the hotel for the increase of profitability and the increase of market share. The study is the report of the hotel Parkview for addressing the major matters that were raised by the managing director of the hotel organization. The present also includes the activities which decrease the profitability and market share. Certain plans are also conducted in the study for the concern of the CEO. These plans include the investment decision in the outsourcing which gives many benefits to the hotel industry. This study also has the certain advices for using the standard costing system which not only benefits the management but also the overall organization. Based on the financial ratio of the hotel Parkview, this study also has the certain budgetary control decisions for the hotel organization.

Executive summary1

Introduction3

Main Body4

Impact of Divesting the Activities4

Increase in the profit4

Increase in the Market Share5

Increase fund for other branding strategy5

Effect on Cash Flow and Working Capital5

Argument on the Investment Decision6

Effect of Investment Decision on the Gearing Ratio and Working Capital7

Importance of standard costing system8

Effect of standard costing system on the workforce8

Behavioral Aspects of Standard Costing System9

Advice on the reliance of the financial ratio10

Advice on the Reliance of the Budgetary Control11

Critically explanation on the company's accounting function11

Conclusion12

References14

Parkview Hotel - Managerial Account

Introduction

In U.S, Parkview hotel is among the five star brands which is said to be the Exclusive business Hotels of the World group. All the Parkview hotel branches offer 25 till 35 exclusive rooms for the boutique properties. The customers of Parkview hotel said that the hotel provide the highest quality of standards with quality services. The management of the park view hotel also provided the quality services according to its promises which were made to their customers. Park view hotel provide the protective and excellent environment to its customers and special guests. The hotel also values the community places so therefore it specially made the places in the community areas and with the help of this activity, management made the relationship with the people of different community (Collier and Gregory, 1995, 16-21).

In the year 2010, management of the hotel Parkview made many efforts for creating the value for both owners and shareholders. The value was created through the brand values and the development of personnel factors which increases the trust, loyalty and the encouragement in an environment of the hotel. But the management fails because of the fixed cost. Fixed cost of the Parkview hotels eat its overall profit margin. Increase in fixed cost is the result of the beverages and the restaurant divisions. Because of fixed cost, the profit margin of the hotel decreased to 2% only (Collier and Gregory, 1995, 16-21).

In the beginning of the 2010, Parkview hotel also faces certain other problems too. The market share of the hotel was decreased because of the increased competition. The hotel industry faced the increase competition which was the result of the local ...