Introduce
Lesson 3. Hotel business accounting
Time: 11 hours (LT: 03; TH: 08)
The article on Hotel Business Accounting presents the contents of methods for calculating production costs, prices, revenues and results of hotel service business. It guides the process of preparing documents and recording accounting books in hotel service business activities.
Objective of the lesson
- Present the method of calculating production costs, prices, revenue and business results of hotel services.
- Present the process of preparing documents and recording accounting books in hotel service business activities.
- Calculate product cost, revenue and business results in hotel service business.
- Prepare documents and record accounting books in hotel service business activities.
Content of the article
1. General issues of hotel business accounting
1.1. Concept
Hotel business is an activity aimed at making a profit by providing room rental services, combined with food and beverage services, entertainment, sales and other services for guests.
Hotel business activities include:
- Business activities: restaurant, bar, souvenir shop.
- Service activities: room rental, accompanying services such as laundry, karaoke, massage, etc.
1.2. Characteristics
- Hotel business mainly provides accommodation services for guests. Revenue and income from this type of service is high, but at the same time requires large investment capital.
- The activities in the hotel are quite diverse, some activities may have unfinished products at the end of the period, some activities do not have unfinished products at the end of the period. Room rental activities may have unfinished products at the end of the period when guests stay from one period to another, service costs have been incurred but customers have not paid, the hotel has not completed serving guests and has not determined revenue.
- For hotel business, depreciation costs of fixed assets are often large because hotels often invest heavily in hotel interiors and equip many modern facilities for bedrooms. The criteria for classifying hotels is the level of interior equipment and amenities of the hotel.
- Hotel business service products cannot be stored, have no physical form, production and consumption of products take place simultaneously.
- Hotel business is highly seasonal, depending on natural conditions, economic, social, cultural and historical conditions. Therefore, cost accounting and product pricing for hotel business need to pay attention to this feature to determine appropriate cost levels.
1.3. Principles
Accounting collects detailed revenue and costs for each activity, including costs for each type of rental room to serve management purposes.
1.4. Accounting tasks
Comply with accounting principles in accounting for the circulation of goods, comply with financial regimes and accounting books as prescribed.
2. Accounting for hotel business operating costs
2.1. Cost accounting and product pricing in customer business activities
hotel
2.1.1. General issues on cost accounting and product pricing in operations
hotel business
2.1.1.1. Concept
Hotel business costs are the total value of necessary social labor costs (including live labor and materialized labor) to carry out the production and supply of hotel products.
Hotel service prices include 3 items:
- Direct material costs.
- Direct labor costs.
- General production costs.
2.1.1.2. Classification of hotel business operating costs
a. Classification according to the economic nature of costs
- According to this classification, expenses of the same nature and economic content are arranged into one element, regardless of where the expense arises or what purpose it is used for in the hotel business.
- Total hotel business costs include the following factors:
+ Raw material costs: include all costs of raw materials that the hotel has used for tourism business activities such as soap, toothpaste, tea, cigarettes, etc.
+ Cost of tools and equipment: is the allocated value of tools and equipment serving business activities in the hotel such as tablecloths, vases, towels, blankets, etc.
+ Labor costs: are the salary costs that the hotel must pay to employees serving hotel business activities, social insurance, health insurance, and union contributions that the hotel must pay to employees serving in the hotel.
+ Fixed asset depreciation costs: include depreciation of fixed assets used for hotel business invoices
+ Cost of purchased services: includes electricity, water, telephone, and other costs payable.
+ Cash expenses: include other expenses incurred in cash not reflected in the above expense items serving the hotel's business activities such as expenses for receiving guests, conferences, etc.
b. Classification according to purpose and economic use of costs
- According to this classification, hotel business operating costs are classified according to business expenses with the same economic function.
- According to these classifications, hotel business costs are divided into the following items:
+ Direct material cost: is the cost of materials equipped for the bedroom for guests to use such as: soap, toilet paper, bleach, toothpaste, shampoo, mosquito repellent, etc.
+ Direct labor costs: are the costs of basic salary, additional salary, other salary-related payments, and deductions from the salaries of employees directly serving hotel business operations.
+ General service business costs: are the costs of serving and managing the process of performing services. These are costs incurred within the units and departments that directly provide services. General production costs include: indirect materials involved in the service provision process, salaries of direct managers, salaries of reception staff, tool costs, depreciation of fixed assets, electricity and water costs, repair costs of fixed assets, and other cash costs.
2.1.1.3. Objects, methods of collecting costs and service prices
2.1.1.3.1. The cost aggregation object is each type of service such as room service, bar, karaoke, massage, etc.
2.1.1.3.2. Cost aggregation method
- Direct material costs
For materials used that are directly related to each cost collection object (bedroom), the cost is directly accounted for that object. For example: The cost of soap for type 1 bedrooms is accounted for type 1 bedrooms.
In case the issued materials are related to many cost aggregation objects and cannot be separated, the indirect allocation method must be applied to each object.
complement i
Cost to be allocatedTotal cost to be allocated | Criteria to be analyzed complement i | ||
= | x | ||
Total criteria to be allocated |
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For example: 10 bottles of room spray are sold, each bottle costs 120,000 VND/bottle for 10 floors, each floor has 7 rooms.
for each room1,200,000 | |||
= | x | 1 = 17,143 VND/room | |
10 x 7 | |||
Cost to be allocated
- Direct labor costs: If wages paid by product or wages by time are related to each specific object, then account directly for each object that bears that cost. If wages of direct production workers are related to many objects, then we proceed to allocate.
In case of indirect allocation, the allocation criteria for direct labor costs can be: Standard wage costs, standard hourly wages, actual work, volume of products produced, etc.
- General production costs: If there are many types of products, jobs or services, the general production costs of each department or unit are allocated to related objects according to certain allocation standards. It can be allocated according to the total cost incurred, or it can be allocated according to each department of general production costs that have been collected on the level 2 account of this account.
The criteria used to allocate general production costs can be: Direct labor costs, direct material costs, total basic production costs, and estimated (standard) general production costs. Calculation formula:
complement i
CPSXC distribution levelTotal manufacturing overhead costs | Criteria to be allocated to the object statue i | |
= | x | |
Total criteria to be allocated |
2.1.1.3.3. Method of calculating service cost
a. Simple costing method
This method is applied in cases where the cost accounting object is consistent with the cost calculation object.
For small-scale hotels with only one type of room, the cost accounting object suitable for the cost calculation object is the room business service; or for medium- and large-scale hotels with many types of rooms, the cost collection object is each type of room and the cost calculation object is also each type of room.
Total cost and unit cost are calculated by the following formula:
hotel service
Total actual cost of the service= | Cost of unfinished service beginning of period | + | Service charges incurred during the period | - | Cost of unfinished service end of period |
hotel service
Unit price of serviceTotal actual cost of hotel services | |
= | |
Total number of services completed during the period |
b. Coefficient method
This method is applied in cases where the cost accounting object is a group of services of the same type, while the cost calculation object is each type of service.
For medium and large-sized hotels with many types of rooms, the cost accounting object is the room business service, and the cost calculation object is each type of room.
According to this method, first of all, we must base on the conversion coefficient to convert different types of service products (different types of rooms) to the selected standard service product (room type), on that basis, calculate the cost for each type of service (each type of room).
- Convert different types of chambers to standard chamber types, according to the formula:
Q = ∑ Qi x Hi
In which: Q: Total converted volume of products and services Qi: Volume of products and services i
Hi: Conversion factor of product service i
- The cost of a standard bedroom unit is determined:
(Zc)
Standard bedroom unit priceTotal cost of sleeping room service | |
= | Total number of rooms converted to standard rooms |
- Unit price of bedroom type I (Zi)
(Zi)
Unit price of type i bedroom= | Standard bedroom unit price (Zc) | x | Conversion factor for room type i (Hi) |
- Total cost of type i bedroom
bedroom type i
Total cost of= | Total number of days and nights off reality in room type i | x | Unit price bedroom type i |
For example: Hotel A has 3 types of rooms: type 1, type 2, type 3. The total cost of room service at Hotel A is 272,000,000 VND. Assuming there is no SPDD at the beginning of the period. The volume of services provided to guests and the conversion factor of each type of room are as follows:
Chamber type
Q i (day – room) | H i coefficient | |
Type 1 | 400 | 1.5 |
Type 2 | 600 | 1.0 |
Type 3 | 200 | 0.8 |
Requirement: Calculate the unit cost for each type of chamber. Solution:
Total number of days – converted room according to standard room (room type 2) 400 x 1.5 + 600 x 1 + 200 x0.8 = 1,360
Unit price of standard chamber type: 272,000,000 / 1,360 = 200,000
=> Z unit room type 1: 200,000 x 1.5 = 300,000 (VND/day - room) Z unit room type 2: 200,000 x 1.0 = 200,000 (VND/day - room) Z unit room type 3: 200,000 x 0.8 = 160,000 (VND/day - room)
c. Ratio method
This is a costing method applied in cases where the cost accounting object is a group of products and services and the costing object is each product and service, in cases where the enterprise cannot establish cost coefficients.
Total actual cost of service group
𝑇𝑙 ...
Total cost of service group plan
Total cost and unit cost of each service type are determined:
Total actual cost of service i = Total planned cost of service ix Ratio
For example: Hong Gia Hotel provides 3 types of rooms for guests: type 1, type 2, type 3. The total actual cost incurred during the period related to all 3 types of rooms mentioned above is 101,000,000 VND. The volume of services provided to guests and the planned unit cost of each type of room are as follows:
Room type
Qi (Day-room) | Zđvkh (VND/Day/room) | |
Type 1 | 600 | 80,000 |
Type 2 | 500 | 60,000 |
Type 3 | 550 | 40,000 |
Requirement: Calculate the total actual cost and unit cost of rooms type 1,2,3. Solution:
𝑇𝑙 ...
101,000,000
(600x80,000 + 500x60,000 + 550x40,000)
= 1.01
Total actual cost of rooms type 1,2,3: Z1= 80,000 x 600 x 1.01 = 48,480,000
Z2= 60,000 x 500 x1.01 = 30,300,000
Z3= 40,000 x 550 x1.01 = 22,220,000
Actual unit price of room type 1:
48,480,000 : 600 = 80,800 (VND/day-room) Actual unit price of room type 2:
30,300,000 : 500 = 60,600 (VND/day-room) Actual unit price of room type 3:
22,220,000 : 550 = 40,400 (VND/day-room)
2.1.1.4. Accounting accounts used
- Account 621 – Raw Material Costs: This account is used to collect raw material costs for the production process, opened in detail for each cost collection object (room service, restaurant service, etc.)
- Account 622 – Direct labor costs: This account is used to collect all costs related to direct labor departments such as salaries, wages, salary allowances, etc., opened in detail for each cost collection object.
- Account 627 – CPSXC: This account is opened in detail for each unit and service providing department.
- Account 154 – CPSX KDDD: This account is used to collect total costs (raw materials, direct materials, direct labor, general production costs) and calculate the cost of the volume of services performed.
In hotel business, account 154 must be opened in detail for each type of service such as: Food and beverage activities, room service, entertainment services, other services (laundry, ironing, haircut, telegram, sports,...)
2.1.1.5. Accounting method
(1). When exporting raw materials to directly produce and trade services, based on the export receipt, the accountant calculates the actual value of the export. Record:
Debit account 621 – Direct material costs Credit account 152 – Raw materials
(2). In case purchased raw materials are not stored in the warehouse, but are used directly for service business activities.
Debit account 621 – Direct material costs (Purchase price excluding VAT) Debit account 133 – Deductible VAT
There are accounts 331, 141, 111, 112,...
(3). In case the product is not subject to VAT, the enterprise shall pay tax by the direct method.
Debit account 621 - Cost of additional materials (Purchase price including VAT) Credit accounts 331, 141, 111, 112,...
(4). Raw materials and supplies that are not fully used in product manufacturing or service provision at the end of the period are returned to the warehouse and recorded as follows:
Debit account 152 - Raw materials, materials
Credit account 621 - Direct material and raw material costs.
(5). Salaries, wages and other amounts payable to employees directly performing services, based on the Salary Allocation Table, record:
Debit account 622 - Direct labor costs
Credit account 334 - Payable to employees.
(6). Calculate and deduct social insurance, health insurance, trade union fees, and unemployment insurance for employees directly performing the service (the part included in the costs that the enterprise must bear) from the salary and wages payable according to the prescribed regime, record:
Debit account 622 - Direct labor costs.
Credit account 338 - Other payables (3382, 3383, 3384, 3386). (7). Salaries, wages, and allowances payable to unit management staff.
position, department, team, production team, record:
Debit account 627 - General production costs (6271) Credit account 334 - Payables to employees.
(8). Deduct social insurance, health insurance, union fees, unemployment insurance according to the current prescribed rate on the salary payable to department managers, record:
Debit account 627 - General production costs (6271)
Credit account 338 - Other payables (3382, 3383, 3384, 3386). (9). Cost of materials used in common for units and departments, such as repair and maintenance.
Maintenance of fixed assets used for managing and operating workshop operations, record: Debit account 627 - General production costs (6272)
There is account 152 - Raw materials, materials.
(10). Cost of tools and equipment issued for use by production units and departments with small total value, based on warehouse delivery notes, recorded:
Debit account 627 - General production costs (6273) Credit account 153 - Tools and equipment.
(11). When issuing production tools and equipment with a large total value for use by departments, teams, or production groups, they must be gradually allocated and recorded as follows:
Debit account 242 - Prepaid expenses
There is account 153 - Tools and equipment.
When allocating the value of tools and equipment to general production costs, record: Debit account 627 - General production costs (6273)
Credit account 242 - Prepaid expenses.
(12). Depreciation of fixed assets used directly for service performance, record: Debit account 627 - General production costs (6274)
Credit account 214 - Depreciation of fixed assets.
(13). Costs of purchased external services such as: electricity, water, telephone and other cash costs incurred within the scope of units and departments directly performing the service such as: reception costs, transactions,... based on related documents, record:
Debit account 627 - General production costs (6278)