Horizontal Analysis definitions Flashcards
Horizontal Analysis definitions
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Horizontal Analysis
Evaluation of percentage changes in financial statement accounts over time to identify trends and assess performance.Percentage Change
Result of comparing the difference between two periods' amounts, divided by the earlier period's amount, expressed as a percent.Account Balance
Monetary value recorded in a specific financial statement account at a given point in time.Base Period
Earlier year or period used as a reference point for calculating changes in financial data.Current Year Amount
Figure representing the most recent period's value for a specific financial statement item.Previous Year Amount
Value of a financial statement item from the period immediately before the current one.Dollar Amount of Change
Numerical difference between the current and previous period's account balances.Net Sales
Total revenue from sales after deducting returns, allowances, and discounts.Cost of Goods Sold
Direct expenses associated with producing or purchasing goods sold during a period.Gross Profit
Difference between net sales and cost of goods sold, indicating profitability before other expenses.Multi Step Income Statement
Financial report format that separates operating and non-operating activities, highlighting subtotals like gross profit.Trend
Pattern or direction of changes in financial data over multiple periods, often revealed through analysis.Investor
Individual or entity using financial analysis to assess company performance and make funding decisions.Creditor
Party evaluating financial statements to determine a company's ability to repay borrowed funds.