Analyzing financial statement account balances over time for the same company is called:
A) vertical analysis.
B) horizontal analysis.
C) common-size analysis.
D) price analysis.

Question

Quizplus · Accepted Answer

Analyzing financial statement account balances over time for the same company is called horizontal analysis, which compares the account balances from different periods to identify changes and trends. Vertical analysis is used to compare different categories of accounts within the same period, common-size analysis is a type of vertical analysis that expresses account balances as percentages of a selected base amount, and price analysis is a method of comparing product or service prices in the marketplace.

Analyzing Financial Statement Account Balances Over Time for the Same