The primary focus of horizontal analysis is:
A) percentage changes in comparative financial statements.
B) the balance sheet only.
C) the changes in individual financial statement amounts as a percentage of some related total.
D) the change in key financial statement ratios over a certain time frame.

Question

Quizplus · Accepted Answer

The primary focus of horizontal analysis is to calculate the percentage changes in comparative financial statements over a period of time. This allows for an evaluation of the increase or decrease of financial statement line items, and helps identify potential trends or areas of concern.

The Primary Focus of Horizontal Analysis Is