Atlantico Hotel Ltd is a medium-sized privately-owned hotel situated in the central business district of Liverpool. It
Question:
Atlantico Hotel Ltd is a medium-sized privately-owned hotel situated in the central business district of Liverpool. It is located at the main entrance of a major business park. The hotel offers accommodation, restaurant facilities, a fully equipped fitness centre, a business centre and a host of other facilities to lure business travellers, such as concierge services, currency exchange and airport and railway transfers. Bryan Seacrest manages and holds 100 per cent of the hotel’s share capital. He is 65 years of age and wishes to retire from active work life in the next five years and travel the world. He has invited offers from interested individuals who can join him in partnership and take a controlling interest in Atlantico when he retires. Kate Hope is one such prospective partner who is interested in joining Bryan’s hotel business. Kate has previously worked in the hospitality industry and is confident that she would be able to effectively manage a hotel of this size. She has collected data about the hotel’s performance over the past two years to help her decide whether to join Bryan’s hotel as a business partner. The data gathered by Kate are based on the balanced scorecard approach to performance measurement. The relevant data are presented in Appendix 1 and Appendix 2.
Appendix 1.
Appendix 2.
Required
1. Based exclusively on the information provided in Appendix 1, assess the financial performance of Atlantico Hotel.
2. Discuss why the data in Appendix 2 are more likely to provide a better indication of Atlantico’s future success than the data in Appendix 1.
3. Using all the information available, assess Atlantico’s prospects and advise Kate Hope as to whether or not she should join Bryan in a partnership.
Step by Step Answer:
Management Accounting
ISBN: 9780077185534
6th Edition
Authors: Will Seal, Carsten Rohde, Ray Garrison, Eric Noreen