When comparing entity financial ratios with industry ratios:
A)it should be assumed that the data result from the consistent application of alternative accounting methods.
B)relative values at a point in time may not be significant.
C)the trend of entity ratios should be compared to the current year's industry ratio.
D)entity ratios should not be compared with industry ratios.

Question

Quizplus · Accepted Answer

Relative values at a point in time may not be significant because they can be influenced by temporary factors or seasonal variations, so it's important to consider trends over time.

When Comparing Entity Financial Ratios with Industry Ratios