If a hotel has an ADR of $162.88 and sold 16,650 rooms, what is the total room revenue?
Understand the Problem
The question is asking to calculate the total room revenue generated by the hotel using the given Average Daily Rate (ADR) and the number of rooms sold. The total room revenue can be found by multiplying the ADR by the number of rooms sold.
Answer
The formula for total room revenue is $TRR = ADR \times R$.
Answer for screen readers
The total room revenue is given by the equation ( TRR = ADR \times R ).
Steps to Solve
- Identify the Given Values
We need to find the Average Daily Rate (ADR) and the number of rooms sold. Let's denote ADR as $ADR$ and the number of rooms sold as $R$.
- Formulate the Total Room Revenue Formula
The total room revenue ($TRR$) can be calculated using the formula:
$$ TRR = ADR \times R $$
- Substitute the Given Values
Now, substitute the values of $ADR$ and $R$ into the formula to find the total room revenue.
- Calculate the Total Room Revenue
Perform the multiplication to find the total room revenue.
The total room revenue is given by the equation ( TRR = ADR \times R ).
More Information
Total room revenue is an important measure for hotels as it reflects the income generated from room sales. Understanding how it is calculated can help in making price adjustments and optimizing sales strategies.
Tips
- Forgetting to convert units: Ensure both ADR and rooms sold are in compatible units (e.g., ADR per night, rooms sold for the same period).
- Mistaking revenue for profit: Remember, total room revenue is not the same as profit; it does not account for costs.
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