Chapter 13, Problem 13.6BE

a.

To determine

Horizontal Analysis: Horizontal analysis is prepared to make comparison between the financial statements to determine the changes in the financial statements for the previous year to the current year. The changes of the company are measured in dollars as well as in percentage.

Formula:

$\text{Percentage Change}=100\times \frac{\text{Later Period}\text{Amount}-\text{Base}\text{Period Amount}}{\text{Base Period Amount}}$

To determine: The percentage of change in net income from 2012 to 2013 and 2013 to 2014.

b.

To determine

To Calculate: Percentage of change from 2013 to 2014.