Can one infer from the income statement if a hotel is third-party managed?
A) Yes, the General Manager's salary and related expenses are shown separately on the income statement.
B) Yes, the associated fees are an expense just below GOP on the income statement
C) No, one should study the balance sheet to find out if that is the case
D) No, such cannot be inferred from studying any of the financial statements

Question

Quizplus · Accepted Answer

Third-party management fees are typically listed as an expense on a hotel's income statement, just below gross operating profit (GOP). This expense line item indicates that the hotel is managed by a third-party management company, rather than being self-managed by the hotel's ownership or management team. Therefore, one can infer from the income statement that a hotel is third-party managed if such fees are listed as an expense.

Can One Infer from the Income Statement If a Hotel