Ratio, Vertical, and Horizontal Analyses
XACC/280
May 8, 2012

Analyzing financial statements can help a company find out important financial information about itself and other competitors in the industry. There are three important tools that evaluate a company’s liquidity, profitability, and solvency. This information is relative to banks, creditors, and for internal gain. There are three commonly used tools to help investigate and generate the results using percentages and ratios.

The horizontal analysis evaluates data from the financial statement over a period of time to generate the data needed for the analysis. The purpose of the analysis is to figure out the increase and decrease in amounts by percentages. This is a tool used to evaluate gains internally.

The vertical analysis is used to show each item on the financial statement as a percentage of a base amount (Weygandt, Kimmel, & Kieso, 2008). Its purpose is to show the relative size of each category on the balance sheet. This method is used to compare a company with others in the same field.

Ratio analysis shows the relationship among a line item chosen from the data on the financial statement (Weygandt, Kimmel, & Kieso, 2008). The results are shown either in a percentage or ratio of the mathematical relationship between the totals. This is also another good tool to compare with the results of other industry peers.

The PepsiCo, Inc.
Current Ratio for 2005:
Formula - Current Assets
Current Liabilities= Current Ratio
10454
9406= 1.11:1
Current Ratio for 2004:
8639
6752= 1.28:9
Vertical Analysis
Formula - Items on Balance Sheet
Total Assets= %
Current Assets10454
Total Assets=31727 = 33%
Formula - Item on Balance Sheet
Total Liabilities with Shareholders Equity = %
Short Term Obligations 2889
Total Liabilities with Shareholders Equity= 31727 = 9%
Horizontal Analysis
Formula -Current Year Amount...

...Ratio, Vertical, and HorizontalAnalyses
Regina Stewart
XACC/280
February 3, 2012
Jose Rodriguez
Ratio, Vertical, and HorizontalAnalyses
A detailed examination of the tools used in financial analysis, in addition to their various functions, is provided within this paper. The current ratio and calculations on the questions are provided herein.
A variety of...

...Ratio, Vertical and HorizontalAnalyses
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XACC/280
XXXXXXXXXX
Ratio, Vertical and HorizontalAnalyses
The three tools of financial statements analysis are Horizontal (trend), Vertical (common size), and Ratio. The first financial statement analysis is horizontal which evaluates the performance of the company...

...Ratio, Vertical, and HorizontalAnalyses
Heather Wassell
XACC/280
April 7, 2013
University of Phoenix
Ratio, Vertical, and HorizontalAnalyses
Financial statement analysis is the process of examining relationships among financial statement elements and making comparisons with relevant information. There are a variety of tools used to evaluate the significance of...

...XACC/280
Week 7 Checkpoint: Ratio, Vertical & Horizontal Analysis
Jennifer Brooks
3/5/2010
Three commonly used tools of financial system analysis are the horizontal analysis, the vertical analysis, and the ratio analysis. The horizontal analysis is a technique used for evaluating financial statement data over a period of time. This serves to show performance increase and decrease and...

...Ratio, Vertical, and HorizontalAnalyses Checkpoint
Ashlee Kasica
XACC/280
March 2, 2013
Brandi Zuber
Financial statement analysis is the process of examining relationships among financial statement elements and making comparisons with relevant information. There are a variety of tools used to evaluate significance of financial statement data. Three of the most commonly used tools are the...

...Ratio, Vertical, and HorizontalAnalyses
There are three ways internal and external users of a company can analyze financial statements. They include the vertical analysis, the horizontal analysis, and the ratio analysis (Weygandt, Kimmel, & Kieso, 2008). The vertical analysis is a technique that expresses each financial statement as a percent of a base amount (Weygandt,...

...tools of financial statement analysis are called vertical analysis and horizontal analysis. Much like the definitions of vertical and horizontal, these two analyses are similar, but also have striking differences. In this paper I will provide you with information regarding the two tools, vertical and horizontal analysis, and how comparing them is applied to two big businesses called PepsiCo,...

...9/15/13
What is the difference between vertical analysis and horizontal analysis? | AccountingCoach.com Q&A
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