If a 300-room hotel achieves 70 percent occupancy for April at an ADR of CHF 153 per room, what will the month room revenue be equal to ?Single choice
A
a. 3'213
B
b. 32'130
C
c. 963'900
D
d. 1'377'000

Question

If a 300-room hotel achieves 70 percent occupancy for April at an ADR of CHF 153 per room, what will the month room revenue be equal to ?

BlackTom AI · Accepted Answer

Monthly room revenue equals available rooms × occupancy rate × ADR × number of days in the month.

1) Relevant knowledge points and concepts
- ADR (Average Daily Rate) is the average revenue earned per occupied room per night.
- Occupancy rate gives the proportion of rooms sold each night.
- Monthly room revenue = (rooms available × occupancy rate × ADR) × number of days in the month (or equivalently rooms sold per night × ADR × nights).

2) Step-by-step reasoning and intermediate calculations
- Rooms available per night = 300.
- Occupancy rate = 70% = 0.70.
- Occupied rooms per night = 300 × 0.70 = 210 rooms.
- ADR = CHF 153 per occupied room per night.
- Revenue per night = occupied rooms × ADR = 210 × 153.

3) Show the arithmetic
- 210 × 153 = 210 × (150 + 3) = 210 × 150 + 210 × 3
- 210 × 150 = 31,500
- 210 × 3 = 630
- Revenue per night = 31,500 + 630 = CHF 32,130
- April has 30 days, so monthly room revenue = 32,130 × 30 = CHF 963,900

4) Why the correct answer is correct
- The calculation uses the standard definitions (rooms available, occupancy, ADR, and nights) and multiplies them correctly. CHF 963,900 is the total revenue generated by selling 210 rooms each night at CHF 153 over 30 nights.

5) Why the other options are incorrect
- a. CHF 3'213 is far too small; it equals 153 × 21 (not relevant) and misses the correct scale (nightly and monthly factors).
- b. CHF 32'130 is the revenue per night, not the monthly total.
- d. CHF 1'377'000 equals 300 × 153 × 30, which would be total revenue at 100% occupancy, not 70%.

6) Conclusion
The month room revenue is CHF 963'900, which matches the provided correct answer (option c: 963'900).

If a 300-room hotel achieves 70 percent occupancy for April at an ADR of CHF 153 per room, what will the month room revenue be equal to ?Single choice

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