Question

Comparative Balance Sheet

Options

• is the Horizontal Analysis of Balance Sheet.

• shows the increase/decrease of various items of the Balance Sheet.

• is more useful as compared to single year’s Balance Sheet.

• All of the above.

Answer 1

All of the above.

Explanation:

A Comparative Balance Sheet satisfies all these points because it conducts a horizontal analysis by comparing financial positions across multiple accounting periods side-by-side. This arrangement clearly shows the absolute increase or decrease in various assets, liabilities, and equity items over time, making it far more useful for identifying growth trends and financial patterns than a static, single year’s Balance Sheet.