Which of the following statements is true?
A)Because gross profit percentages are so consistent from period to period they are not very useful for analyzing one company over time.
B)Because gross profit percentages are so variable across industries they are most useful in comparing companies from different industries.
C)Because gross profit percentages are so variable across industries they are more useful in analyzing one company over time.
D)Because gross profit percentages are so consistent across industries they are most useful in comparing companies from different industries.

Question

Quizplus · Accepted Answer

Gross profit percentages can vary significantly across different industries due to differences in cost structures and pricing strategies. Therefore, comparing gross profit percentages across industries may not provide meaningful insights. However, analyzing the gross profit percentage of a single company over time can reveal trends, efficiencies, or issues within that company's operations, making it a useful tool for internal analysis.

Which of the Following Statements Is True