Final answer:
Option A)) The statement is true; horizontal analysis calculates changes and helps detect performance trends in a company's financial statements over time.
Step-by-step explanation:
Horizontal analysis is a financial analysis technique that compares historical financial information over a series of reporting periods, or against another company. It involves the computation of both dollar changes and percentage changes in the line items of comparative financial statements.
This process is valuable because it helps flag any significant fluctuations that could signify improvements or deterioration in a company's financial performance.
By performing horizontal analysis, analysts and stakeholders can identify trends in financial statements and better understand the direction in which a company is headed.
Therefore, the statement about the horizontal analysis that "it is the calculation of dollar changes or percentages changes in the comparative statement items or total" is true.