Analysis

summary 1

Financial Analysis

Shannon Wallace

Accounting Concepts for Health Care Professional

Latricia Carter

January 23, 2012

ANALYSIS 2

Over the next couple of pages I will be discussing three types of pecuniary digest horizontal,

vertical, and ratio. Horizontal analysis is overly known as trend analysis, refers to studying the

behavior of several(prenominal) pecuniary statement items over several accounting periods. Horizontal

analysis uses strong totalitys and character analysis. Absolute analysis of particular financial

statement items have many uses. Various national frugal statistics, such as gross domestic

product and the amount spent to replace productive capacity, are derived by combine absolute

amounts reported by businesses.



Comparing only absolute amounts has drawbacks because item

differ from phoner to company and stratum to year. constituent analysis involves computing the

percentage relationship between deuce amounts. In horizontal percentage analysis a financial

statement item is expressed as a percentage of the previous balance for the same item. Percentage
analysis sidesteps the corporality problems by comparing different size companies by measuring stick

changes in percentages. The financial information from horizontal analysis provide help a company

decide on which products to backup or get rid of a certain product. showcase a company sells hot

tamale and red hots. The hot tamale gross sales increased by twenty-five percent last year and the

sales of red hots decreased by five percent. The company found out this information using

horizontal analysis. An grammatical case of using horizontal analysis in a wellness care situation is a

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