A Horizontal Analysis Performed on a Statement of Retained Earnings

question 154

Multiple Choice

A horizontal analysis performed on a statement of retained earnings would not show a percentage change in

• A) dividends declared.
• B) net income.
• C) expenses.
• D) beginning retained earnings.

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Definitions:

Expenses

Costs incurred by a business in the process of earning revenue.

Revenues

Total financial earnings of a company derived from its key operational processes, including the sale of products or services.

Equity

The value of the shares issued by a company, representing the ownership interest in the company's assets after liabilities are subtracted.

Accounts Payable

The short-term liabilities or obligations a company owes to its suppliers or creditors for goods and services received.