Choice of calculation method
30. In cases where there are rental periods of varied length, some of which are 60 days or more and some of which are less than 60 days, a method must be chosen for determining if the establishment meets the 90%-or-more test. The method should be appropriate in the circumstances and be used consistently.
Acceptable methods
31. Acceptable methods include basing the calculation on revenues (either daily or total), or on identical lease periods or intervals such as number of “room nights” sold, or on the number of rooms available for rent for periods of less than 60 days and those for periods of 60 days or more.
Time period
32. The time period to be used when determining if the establishment meets the 90%-or-more test is also flexible provided the period is reasonable for the supplies in question and is used on a consistent basis. Normally, a one year period is appropriate. However, the period could differ depending on the nature of the operations (e.g., seasonal).
Calculated once
33. If the test is applied on a prospective basis and covers a reasonable period of time (a full year), the resulting determination will not need to be revised unless actual operations turn out to be materially different from those foreseen.
