To compute the percentage change in a horizontal analysis from last year to this year, the computation will be:
A) (Current Year - Last Year)/ Last Year.
B) (Last Year- Current Year)/ Last Year.
C) (Last Year- Current Year)/ Current Year.
D) (Current Year- Last Year)/ Current Year.

Question

Quizplus · Accepted Answer

The correct formula for computing the percentage change in a horizontal analysis (which compares financial data over two periods) is (Current Year - Last Year) / Last Year. This formula shows how much the current year's figure has increased or decreased from the last year in percentage terms.

To Compute the Percentage Change in a Horizontal Analysis from Last