Comparing changes in net income for one company over time is an example of:
A)Vertical analysis.
B)Horizontal analysis.
C)Diagonal analysis.

Question

Quizplus · Accepted Answer

Horizontal analysis compares financial information over time to identify changes and trends. In this case, the changes in net income for one company are being compared over time. Vertical analysis looks at the relative proportions of financial statement items within a single point in time, and diagonal analysis is not a recognized term in financial analysis.

Comparing Changes in Net Income for One Company Over Time