An example of horizontal analysis is
A) common-size statements.
B) trend analysis.
C) ratio analysis.
D) profitability analysis.

Question

Quizplus · Accepted Answer

The best choice for an example of horizontal analysis is trend analysis, as it involves comparing financial data over a period of time, typically using percentage changes or ratios. Horizontal analysis focuses specifically on changes in financial data over time, rather than comparisons to benchmarks or industry averages (which would fall under ratio analysis) or the expression of financial data as percentages (which would fall under common-size statements). Profitability analysis, while important, is not directly related to the comparison of financial data over time.

An Example of Horizontal Analysis Is