Horizontal Analysis Evaluates Financial Data

question 28

Multiple Choice

Horizontal analysis evaluates financial data:

• A)for one year.
• B)for the future.
• C)over a period of time.
• D)none of the above.

---

Definitions:

Dividend Payout Ratio

The percentage of earnings paid to shareholders in dividends, indicating how much money a company returns to shareholders vs. retaining.

Internal Growth Rate

The maximum rate at which a company can expand internally without needing to obtain additional external financing.

Capital Intensity Ratio

A metric that measures the amount of capital needed per unit of output, indicating how capital-intensive a business operation is.

Operating Capacity

The maximum output that an organization can produce with its current resources and constraints.