The following paragraph appeared in a chain motels monthly in-house newsletter announcing the creation of a trophy
Question:
The following paragraph appeared in a chain motel’s monthly in-house newsletter announcing the creation of a trophy that will be awarded to the motel with the most outstanding performance each year:
The trophy will be given to the motel with the best combination of sales percentage increase and net income percentage increase. The actual calculation will be to take the sales percentage increase, add the net income percentage increase, and to divide that total by 2, with equal weight given to both sales and net income growth. Only motels achieving a minimum 15% sales increase will be eligible.
What is your evaluation of the way performance is to be measured in this motel chain? Use 2 or 3 examples to demonstrate your opinion.
Step by Step Answer:
Hospitality Management Accounting
ISBN: 9780471092223
8th Edition
Authors: Martin G Jagels, Michael M Coltman