Chapter 1, Problem 3PB

A partial list of The Grand Hotel’s costs follows:

1. a. Advertising in local newspaper
2. b. Bedding (sheets, blankets, pillows)
3. c. Bellhop wages
4. d. Champagne for special guest packages
5. e. Coffee and tea for rooms
6. f. Cost of customer surveys
7. g. Depreciation of the hotel
8. h. Desk clerk wages
9. i. Guest long-distance telephone costs
10. j. Kitchen employee wages
11. k. Laundering towels and sheets
12. l. Lobby furniture
13. m. Maid wages
14. n. Mini-bar supplies
15. o. New carpeting
16. p. Painting lobby
17. q. Pay-per-view movie rental costs (in rooms)
18. r. Salary of the hotel manager
19. s. Soaps and shampoos for rooms
20. t. Training for hotel restaurant servers
21. u. Utility costs for hotel
22. v. Valet parking services
23. w. Wages of convention setup employees

Instructions

1. 1. What would be The Grand Hotel’s most logical definition for the final cost object?
2. 2. Identify whether each of the costs is to be classified as direct or indirect. For purposes of classifying each cost as direct or indirect, use the hotel guest as the cost object.