______ analysis identifies the relative contribution made by each financial statement line item.
A)Ratio
B)Vertical
C)Horizontal

Question

Quizplus · Accepted Answer

Vertical analysis is also referred to as common-size analysis which focuses on the relative size of different line items within the same financial statement. It expresses every line item as a percentage of the base amount, allowing for an easy comparison of financial statement items. Ratio analysis, on the other hand, compares items across financial statements and analyzes relationships between them. Horizontal analysis compares items over time to identify trends and changes.

______ Analysis Identifies the Relative Contribution Made by Each Financial