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hello and welcome to another tlc tutoring company accounting lesson in this video we will be going over a rate of change analysis also known as a horizontal analysis for a balance sheet now keep in mind when were doing a horizontal analysis we are going from left to right so our focus will be on finding the increase or decrease between one year to another keep in mind this is 20x1 so this is my prior year 20x2 this is my current year so for example for cash we see that it decreased right so when were doing a horizontal analysis the first focus is on finding the amount of the increase or decrease so in our case we already said it was a 10 000 decrease lets go ahead and put that into a formula so our current year minus our prior year so that will give us the negative ten thousand and then we will divide that amount by our base year so that will tell us what percentage increase or decrease we have divided by our base year lets turn then to a percentage there we go so we can see that