For trend analysis to work correctly,the accountant uses the:
A)beginning percentage.
B)base year.
C)common-size statement.
D)horizontal analysis.

Question

Quizplus · Accepted Answer

Trend analysis compares financial data from different periods to identify changes and patterns over time. To do this accurately, a base year must be established to serve as a starting point for measuring changes in subsequent years. The base year is usually set to 100%, and changes in subsequent years are expressed as a percentage of the base year. Therefore, the correct choice for trend analysis is the base year.

For Trend Analysis to Work Correctly,the Accountant Uses The