What type of analysis contrasts values in a row-by-column financial table?

Prepare for the PGA Level 1 Business Planning Test. Use flashcards and multiple-choice questions with hints and explanations. Get ready to achieve your goals!

The correct choice is Horizontal Analysis, which involves analyzing financial data over a period of time, typically looking at changes in financial metrics from one period to another. This method can be applied across the rows of a financial table to track trends and growth, reflecting how individual line items have variably increased or decreased across multiple periods.

In the context of a row-by-column financial table, Horizontal Analysis is particularly useful as it allows for comparing figures in the same row across different time periods, effectively showcasing progression or any significant variations in values. This is essential for identifying trends in revenue, expenses, and other financial figures.

In contrast, Vertical Analysis focuses on analyzing a single financial statement by expressing each line item as a percentage of a base amount, such as total revenue or total assets, rather than looking across time. Cost Analysis zeroes in on the costs associated with production or operations, and Fiscal Analysis is often associated with the examination of governmental financial operations. Thus, these methods do not specifically address the cross-temporal comparison inherent in Horizontal Analysis.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy