Question : …………. financial statement analysis is dynamic.
Option 1: Vertical analysis
Option 2: Horizontal analysis
Option 3: Both 1 and 2
Option 4: None of the above
Correct Answer: Horizontal analysis
Solution : Answer = Horizontal analysis
Financial statement analysis that is dynamic: A financial statement analysis that spans multiple years is referred to as dynamic analysis of financial statements. Horizontal analysis is another name for dynamic analysis.
Hence, the correct option is 2.