you would use both horizontal and vertical analysis to determine the decrease in accounts receivable collection, but the most appropriate in this case would be horizontal analysis. Horizontal analysis, also known as trend analysis, is used to evaluate the trend in the financial statements over a certain period of time. It involves comparing line items in the financial statement of a company for two or more periods. In this case, you would compare the accounts receivable collections over the last three months with the same period in the previous year or the preceding months of the same year. This will help you understand the trend and possibly identify the reasons for the decrease. Here's a step-by-step guide on how you might conduct this analysis: Obtain the financial statements for the period under review and the comparable period. Identify the line item for accounts receivable collections. Calculate the difference in the amount of accounts receivable collections between the two periods. Express this difference as a percentage of the amount in the earlier period to get the percentage change. Investigate any significant changes to identify possible causes. Vertical analysis, on the other hand, is used to understand the relationship between individual line