Discover published sets by community

Revenue is the income earned from the sale of goods or services. For example, a hotel's revenue may include income from room rentals, food services, and event hosting.

COGS represents the direct costs attributable to the production of the goods sold or the service provided. In a restaurant, it includes the cost of ingredients and labor to prepare meals.

Gross Profit is the revenue minus the cost of goods sold. It represents the profitability of the core business activities without overhead costs.

Operating Expenses include all costs required to run the business that are not directly tied to a specific product or service. Examples are salaries for management, utility costs, and marketing expenses.

Operating Income, also known as Operating Profit, is the profit earned from normal business operations. It's calculated by subtracting operating expenses from gross profit.

Net Income is the profit after all expenses, taxes, and deductions have been taken into account.

Depreciation is the allocation of the cost of tangible assets over their useful lives. In hospitality, it might include the depreciation of buildings and fixtures. For example, dividing the cost of a hotel building by its useful life to allocate expense each year.

EBIT is a measure of a company's profit that includes all incomes and expenses except interest and income tax expenses.

Interest Expense is the cost incurred by an entity for borrowed funds. In the hospitality industry, this might involve interest paid on loans for property expansion. For example, a hotel might pay interest on a mortgage.

Income Tax Expense is the charge for the tax on earnings reported in the income statement. A restaurant chain's income tax expense would be based on its taxable income and the relevant tax rates.

Other Income includes earnings that come from non-primary business activities. For example, a resort may have income from selling an old piece of equipment.

Other Expenses are costs that are not related to the primary business operations. This could be a loss from a lawsuit for a hotel chain.

This represents the profits or losses from investments in securities or other assets that are not part of the core business operations. A tourism company may record a gain from the sale of shares it held in another company.

Selling Expenses are those directly associated with the selling of products or services and can include advertising, sales commissions, and promotional materials. If a travel agency spends money on advertisements, it's considered a selling expense.

These expenses are related to the overall administration of the business, and include salaries of executive staff, rent for office space, and legal fees. In a hotel, management salaries would fall under this category.

R&D expenses are related to the research and development of new products or services. Though less common in hospitality, a large hotel chain may have R&D costs for developing new customer service technologies.

Amortization is the process of gradually writing off the initial cost of intangible assets. For example, a travel-related software's development cost might be amortized over its expected lifetime.

Bad Debt Expense represents the money owed to a company that it is not able to collect. This can happen in hospitality when guests don't pay their bills. The business would record this as an expense.

Dividend Income is the income a company receives from owning shares of another company. A hotel chain might receive dividend payments from its investments in other businesses.

This represents the gains or losses due to changes in exchange rates affecting foreign currency transactions. A tour operator dealing with multiple currencies may experience a gain or loss when the exchange rates fluctuate.

Restructuring Costs are incurred when a company goes through organizational changes, which may include severance pay and costs of closing facilities. When a hotel chain closes an underperforming hotel, it may incur restructuring costs.

Impairment Charges are recognized when the carrying amount of an asset exceeds its recoverable amount. For instance, a travel agency might write down the value of a hotel property that has permanently lost value.

Litigation Expenses are related to legal actions taken by or against the company. If a hospitality company is sued for breach of contract, the legal fees and any settlement are recorded as litigation expenses.

Loyalty Program Costs include the expenses of running customer loyalty programs, such as points systems for frequent guests. A hotel may offer reward points redeemable for free nights, which have an associated cost.