Bartender’s Association Conference at Highball Hotel. The Bartender’s Association
Conference is to be held at the Highball Hotel. Some of the contract terms are as follows:
• XYZ Hotel will hold the following block of rooms for Bartender’s Association’s (“Group”)
use (“Room Block”):
Date Type No. of Rooms
05/24/2023 Single/Double 150
• Highball Hotel will provide single/double rooms at the Room Rate of $100 per night.
• The Anticipated Room Night Revenue shall be defined as the total Room Block of 150 room nights at Room Rate of $100 = $15,000*
• Highball Hotel agrees to allow for a 15% reduction in the Anticipated Room Night
Revenue, provided that you make a written request for that reduction between now and 60 days prior to your arrival date. At the conclusion of the meeting, we will subtract the room revenue derived from your meeting (excluding revenue derived from pre and post program stays) and the amount of any permissible attrition you have taken from the Anticipated
Room Night revenue set forth above.
[*sometimes the attrition clause sets out the requirements in total revenue amounts, rather than room nights, as it does in this problem]
One February 28, 2023, the Bartender’s Association delivers to the Highball Hotel a written request for a 15% reduction in the room block, which reduces the Anticipated Room Night
Revenue to $12,750 .
(a) If the Bartender’s Association has 100 actual attendees at the conference, how much (if any) will they owe for the attrition fee? Show your calculations.
(b) What would the Bartender’s Association owe as the attrition fee if they did NOT request a reduction in the room block in advance.
