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Preface | |
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Acknowledgments | |
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Finance and the Hospitality Industry | |
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Introduction | |
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Hospitality Industry Financial Challenges | |
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Chapter Structure | |
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Chapter Topics | |
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Financial Reporting | |
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Financial Reporting | |
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Accounting as the Language of Business | |
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Financial Statements | |
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Management Reports | |
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Accounting System-CP[superscript 3] System | |
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Analyzing Financial Statements | |
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Analysis of Financial Statements | |
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Readers of Financial Statements | |
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Types of Analyses | |
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Management Decision Making | |
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Readers of Financial Statements Beware! | |
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Managing Working Capital and Controlling Cash | |
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Managing Working Capital and Controlling Cash | |
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Working Capital | |
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Cash | |
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Growing the Business | |
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The Need for Growth | |
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Shareholder Value | |
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Other Benefits of Growth | |
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Growth Strategies | |
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Increase Sales and Productivity of Existing Properties | |
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Expansion of Physical Facilities | |
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Franchise Brand Rights | |
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Secure Additional Management Contracts | |
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Mergers and Acquisitions of Competitors | |
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Going Public | |
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Financing Growth | |
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The Need for Capital | |
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Capital | |
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Loan Terminology | |
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Types of Loans | |
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Sources of Loans | |
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Equity | |
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Hotel Financing Trends and Schemes | |
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The Golden Age of Hotel Financing | |
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Savings and Loans | |
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Investment Tax Credits | |
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Influx of Foreign Capital | |
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Accelerated Depreciation | |
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Real Estate Tax Shelters | |
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The Tax Reform Act of 1986 | |
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The Resolution Trust Corporation (RTC) | |
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New Financing Schemes | |
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The Time Value of Money | |
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Concept of Time Value of Money | |
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Time Value of Money | |
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Market Value | |
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Calculating Time Value of Money | |
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Time Period and Compounding | |
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Investment Analysis | |
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Investment Analysis | |
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Weighted Average Cost of Capital (WACC) | |
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Discount Rate | |
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Capitalization Method of Valuation | |
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Investment Analysis Tools | |
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Factors Affecting Tools of Investment Decisions | |
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Hospitality Industry Applications of Time Value of Money Concepts and Skills | |
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Time Value of Money Applications | |
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Loan Questions | |
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Equity Questions | |
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Use of Sensitivity Analysis | |
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Hospitality Applications | |
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Using ROI, NPV, and IRR | |
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The Investment Package | |
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The Need for an Investment Package | |
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Executive Summary | |
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Fact Sheet | |
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Business Plan | |
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Source and Use of Funds | |
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Photographs or Renderings | |
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Third-party Confirmation | |
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Project Budget | |
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Qualifications of Project Team | |
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Investment Analysis | |
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Personal Financial Data | |
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Evaluation of the Investment Package | |
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Lenders: Debt | |
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Owner/Investor: Equity | |
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Crafting and Negotiating the Deal | |
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The New Business Venture | |
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The Business Entity | |
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The Debt and Equity Mix | |
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Negotiating Loans with Lenders | |
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Principal | |
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Interest Rate | |
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Points Charged | |
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Additional Collateral | |
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Personal Guarantees | |
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Other Lender Issues | |
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Deal Sponsor's Goals | |
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Negotiating the Equity Investment | |
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Amount of Equity | |
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Percentage of Ownership | |
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Investor Hurdle Rates | |
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Exit Strategy and Decision-making Power on When to Sell | |
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Negotiating Skills | |
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Be Prepared | |
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Be Professional | |
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Use Proven Selling Skills | |
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Tying It All Together | |
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Introduction | |
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Hospitality Industry Financial Challenges | |
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Financial Reporting | |
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Analysis of Financial Statements and Management Reports | |
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Analysis of Financial Statements | |
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Analysis of Industry Reports | |
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Applications of Financial Analyses | |
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Managing Working Capital | |
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Growing the Business | |
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Shareholder Value | |
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Increasing Shareholder Value | |
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Other Benefits of Growth | |
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Growth Strategies | |
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Financing Growth | |
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Types of Capital | |
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Cost of Capital | |
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Mix of Capital | |
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Investment Analysis | |
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The Time Value of Money | |
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Investment Analysis Methods | |
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Favorable or Unfavorable? | |
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Factors Impacting the Analysis | |
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Hospitality Industry Applications | |
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Debt and Equity Negotiations | |
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The Investment Package | |
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What Lenders Want to Know | |
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What Equity Investors Want to Know | |
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Crafting and Negotiating the Deal | |
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Business Decisions to Make | |
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Negotiating the Loan | |
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Negotiating the Equity Investment | |
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Negotiating Skills | |
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Index | |