This document discusses techniques for analyzing financial statements, including horizontal analysis, vertical analysis, and how each applies to balance sheets and income statements. Horizontal analysis examines changes in financial statement items over time, while vertical analysis expresses items as percentages of a key component to compare proportions. Both help evaluate trends and compare financial statements from different periods.

1. Management Accounting
Saddam Hossain
saddamtgb@gmail.com
Dhaka, Bangladesh

2. Balance Sheet &
Income Statement
Horizontal
analysis
Vertical
Analysis

3. Horizontal
Vertical

4. Horizontal Analysis
Horizontal analysis is a financial statement analysis technique
that shows changes in the amounts of corresponding financial
statement items over a period of time. It is a useful tool to
evaluate the trend situations.

5. VerticalAnalysis
Vertical analysis sometimes is
referred to as “common-size
analysis” because all of the amounts
for a given year are converted into
percentages of a key financial
statement component.

6. Horizontal Analysis
Balance Sheet

7. Horizontal Analysis
Income Statement

8. Vertical Analysis
Balance Sheet

9. Vertical Analysis
Income Statement