Marriot Hotel, a public listed company owns a chain of hotels and resorts throughout Malaysia. The company has appointed you to value one of its hotels for the purpose of securities commission.

The tenure is freehold, built on a 20,000 sq. metre site. The building is of high-quality construction and finishes, with stylish designed rooms and luxurious suites. Facilities provided include a swimming pool, fitness centre, tennis court and spa.

The Hotel Management has furnished you the following information:

Room Type	No. of rooms	Room rate
Superior	200	RM200
Deluxe	100	RM300
Suite	15	RM 600

Average occupancy for the past three years is as follows:

Weekends: 85% Weekdays: 53%

An analysis of trading operations for the past three years revealed the following:

Other income
Food and beverage	40% of room revenue
Telephone and fax	RM 60,000 per annum
Banquet hall	RM 380,000 per annum
Annual Purchase
Pillow and mattress	RM 200,000 per annum
Furniture	RM 500,000 per annum
Bed sheets	RM 100,000 per annum

1. Determine the gross income of the hotel

2. List out FIVE (5) operating expenditure of the hotel.

3. Explain TWO (2) disadvantages of profit method