Horizontal Analysis Is Performed When

question 2

Multiple Choice

Horizontal analysis is performed when:

• A)total assets are set at 100% and all other balances are a percentage of total assets.
• B)the percentage change in the balance sheet and income statement numbers is computed for one period to the next.
• C)there is a need to calculate and compare key ratios from period to period.
• D)detecting fraud through financial statements demands calculation of key ratios and comparing them from period to period.

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Definitions:

Joint Probability

The likelihood of multiple events occurring simultaneously.

Joint Probability

The likelihood of two or more events occurring at the same time in a probabilistic framework.

Independent

In statistics, refers to variables or events that are not affected by other variables or events within the scope of the analysis.

Mutually Exclusive

Describes events that cannot occur at the same time, meaning the occurrence of one event excludes the occurrence of another.