Question

51. Provide horizontal analysis of your company’s (La-Z-Boy) income statement and balance sheet, showing the dollar amount and percent of change using the 2 most recent years (you must use an Excel spreadsheet with formulas).

Answer 1

Horizontal Analysis is a time series analysis of the financials by comparing them over periods to understand variances year on year. Here's an example of horizontal analysis income statement & balance sheet.

Income Statement
Particulars	$ Current Year	$ Previous Year
Revenue	100,000	80,000
Gross Profit	55,000	45,000
EBITDA	20,000	15,000
Revenue	25%
Gross Profit	22%
EBITDA	33%
	175,001	140,000

Balance Sheet
Assets	$ Current Year	$ Previous Year	% Change YoY	Liabilities	$ Current Year	$ Previous Year	% Change YoY
Land & Builing	1,000,000	1,000,000	0%	Share Capital	798,000	702,000	14%
Furniture	50,000	40,000	25%	Reserves & Retained Earnings	20,000	15,000	33%
Vehicle	10,000	12,000	-17%	Loans	200,000	300,000	-33%
Inventory	5,000	4,000	25%	Creditors	50,000	40,000	25%
Cash & Bank	3,000	1,000	200%
	1,068,000	1,057,000			1,068,000	1,057,000