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In analyzing financial statements, horizontal
analysis is a
a. requirement.
b. tool.
c. principle.
d. theory.
48. Horizontal analysis is also called
a. linear analysis.
b. vertical analysis.
c. trend analysis.
d. common size analysis.
49. Vertical analysis is also known as
a. perpendicular analysis.
b. common size analysis.
c. trend analysis.
d. straight-line analysis.
50. In ratio analysis, the ratios are never expressed as a
a. rate.
b. negative figure.
c. percentage.
d. simple proportion.
51. The formula for
horizontal analysis of changes since the base period is the current
year amount
a. divided
by the base year amount.
b. minus
the base year amount divided by the base year amount.
c. minus
the base year amount divided by the current year amount.
d. plus the base year amount
divided by the base year amount.
52. Horizontal analysis evaluates a series of
financial statement data over a period of time
a. that has been arranged from the highest
number to the lowest number.
b. that has been arranged from the lowest number
to the highest number.
c. to determine which items are in error.
d. to determine the amount and/or percentage
increase or decrease that has taken place.
53. Horizontal analysis evaluates financial
statement data
a. within a period of time.
b. over a period of time.
c. on a certain date.
d. as it may appear in the future.
54. Assume the following sales data for a
company:
2014 $1,050,000
2013 950,000
2012 800,000
2011 650,000
If
2011 is the base year, what is the percentage increase in sales from 2011 to
2013?
a. 100%
b. 61.5%
c. 46.2%
d. 68.4%
55. Comparative balance sheets are usually
prepared for
a. one year.
b. two years.
c. three years.
d. four years.
56. Horizontal analysis is appropriately
performed
a. only on the income statement.
b. only on the balance sheet.
c. only on the statement of retained earnings.
d. on all three of these statements.
