Cost approach methodology in assessing economic stability of enterprise of hotel and restaurant sector

The article is devoted to improving the employment of cost approach methodology in assessing economic stability of enterprise of hotel and restaurant sector. The essence and the procedure of cost approach which allows calculating qualitative and quantitative value of every cost element and define its relative share in the total resource intensity have been investigated in the paper. It is determined that the most efficient strategic instrument for solving the issues of ensuring economic stability of the enterprise in hotel and restaurant sector is the vector-valued objective function. Its primary goal is to determine the object optimal for each specific criterion. Proceeding from the objective of ensuring sustainable economic growth, vector-valued objective function will include the assessment criteria – performance indicators and resource intensity indicators of operational activity of enterprise that maximize or minimize. The identified criteria assess various states of the analyzed object, with regard to which the decisions are approved. It has been substantiated that the use of economic stability assessment in the taxonomy on the basis of cost approach allows aggregating diversified indicators of the enterprise into a single indicator and identify the impact of various factors upon efficiency and, consequently, stability of the enterprise activity. It is determined that within the scope of the method of calculation by unit costs indicators between result-related and factor-related parameters the connection is employed in the form of proportional linear function. Such approximation cab be maintained only within narrow range of variation of resource intensity indicator. Therefore, for each range it is expedient to allocate its specific ‘per unit’ indicator. Assessment of dynamic economic sustainability of the enterprise is forecasted within a particular time period by means of determining residual variance or root-mean-square deviation indicator (sample variance). An algorithm is established with regard to the agenda for action that encompasses analysis, assessment, forecasting, optimization and serves as an instrument of managing the stability of the enterprise based upon cost monitoring and objective function. Realization of the object function with set restrictions contributes to forming the mechanism of sustainable development of the enterprise in the conditions of uncertainty and dynamic nature of external environment.