When examining quarterly results of a company in a seasonal business, it is useful to:
A)compare to the preceding quarter.
B)match the company's results against economic statistics.
C)compare to the same period in the prior year.
D)analyze using a percentage income statement.

Question

Quizplus · Accepted Answer

When examining quarterly results of a company in a seasonal business, it is best to compare to the same period in the prior year. This allows for an understanding of any trends, patterns or fluctuations that occur during the same season every year. Comparing to the preceding quarter or using economic statistics may not give an accurate reflection of the company's performance in a seasonal business. Analyzing using a percentage income statement may be helpful but it should also be compared to the same period in the prior year.

When Examining Quarterly Results of a Company in a Seasonal