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Horizontal evaluation is the comparability of financial data of an organization with historical financial information of the same company over a lot of reporting periods. It is also primarily based on the ratios derived from the financial data over the same time span. The primary goal is to see if the numbers are high or low compared to previous records, which may be used to analyze any causes for concern. For instance, sure expenditures which can be excessive presently, however were well underneath price range in earlier years may trigger the administration to research the trigger for the rise in costs; it may be as a result of switching suppliers or utilizing better high quality raw materials.

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