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Use of horizontal analysis

Updated: 4/28/2022
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A horizontal analysis of an account on a spreadsheet can allow the user to compare the amount in the account at different dates during a fiscal period. When doing a spreadsheet analysis each entry for the account is listed horizontally until the end of the fiscal period date.

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Q: Use of horizontal analysis
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What includes the horizontal analysis of comparative statement?

In Horizontal analysis of statements companies tries to compare its financial statements with competitors to see that how well or bad they have performed.


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Analysis of financial statement means using the data in the financial statements to perform further calculations and analysis, like ratio analysis, trend analysis, industry comparison, horizontal and vertical analysis, etc. Analysis is useful to understand historical transactions and also to estimate future prospects. Interpretation of financial statement is basically is drawing meaningful conclusions and judgment based on the results of basic or detailed analysis. Example: Profitability analysis shows that the company has made profit for the last 5 years consistently. Interpretation of this analysis will lead to the conclusion that the probability of the company produce profits in next year is high.

Related questions

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In horizontal analysis, each item is expressed as a percentage of the


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