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Hospitality Industry Accounting 4q

4 important questions on Hospitality Industry Accounting 4q

Why do Hospitality Managers Use Managerial
Accounting?

To have a specialized knowledge of the industry.
It is a very specialized area that focuses on accounting techniques and practices used in hospitality businesses.

What are the Uniform System of Accounts?

Hospitality companies managers use suggested (uniform) accounting procedures created specifically for their segment of the hospitality industry.

Restaurants (USAR)
Lodging Industry (USALI)
Uniform System of Financial Reporting for Clubs (USFRC)

VAT Rules, Business registered for VAT must do three things:

charge VAT on goods or services sold to customers and
other businesses

pay VAT on the goods and services bought from other
businesses

file a VAT return every month or quarter to tax
authorities.

Difference between paid and collected VAT is sorted out
via VAT tax return

VAT on the Balance sheet / Income Statement

VAT never affects purchase price for a business

Cost calculations are always ex-VAT

VAT is never part of revenu

Items on Balance Sheet and Income Statement are ex
VAT

VAT payable or receivable is listed on Balance Sheet
under a separate item.

Cash Flow Statement shows VAT paid and received

The question on the page originate from the summary of the following study material:

Hospitality Accounting 1&2

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