Financial Analysis

Task One

A 1a

Horizontal analysis is when an individual looks at the income statement of a company and compares one year to the other to see what kind of percentage it has increased or decreased within the different departments in a company for any given time period. When looking at Competition Bikes (CB) and performing a horizontal analysis, we would take a look at first year 6 and year 7. Between year 6 and 7 there was an increased net sales of 33.3%. This means that from year 6 to year 7 there was a great increase. This means that the customers were happy with the product being sold, and this is a sign of strength within the company. It was a profitable year.

For year 6 and 7 the cost of goods sold also went up 31.8%. This number is to be expected. Since the net...