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Interpreting Financial Results: Family Dollar Stores

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Interpreting Financial Results: Family Dollar Stores
Interpreting Financial Results By
Richard Stewart
FIN 571
March 10, 2015
Dale Hilken

Interpreting Financial Results

A company’s financial ratios play a significant part in determining how the business is doing on a financial basis (Parrino, Kidwell, Bates, 2012). The financial ratios will show the positive and negative financial status of the company. This paper will show the ratios for Family Dollar Stores and the stability over two years.
Family Dollar Stores

Liquidity Ratios FY-12 FY-11

Current Ratio = Current Assets/Current Liabilities

1,768,170 1,533,844 = 1.7 1.5 …show more content…
The obligations must be paid without endangering the firm (Parrino, Kidwell, Bates, 2012). A higher liquidity shows that the company has a greater ability to make short term payments. Over two years Family Dollar shows a high liquidity ratio.

Efficiency Ratios

Inventory Turnover = Cost of Goods Sold/ Inventory 6,071,058 5,515,540 = 4.3 4.8 1,426,163 1,154,660

Accounts Receivable Turnover = Net Sales/ Accounts
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