Test your basic knowledge |

Retail Financials

Subject : business-skills
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Net Profit After Taxes/ Total Assets






2. Net Profit/ Net Sales






3. Cannot be readily converted to cash within one year. (Fixtures - equipment - land/buildings)






4. Revenues received by a retailer






5. Having the right merchandise - at the right time - for the right price - in the right place






6. Sales for the period/ average inventory






7. (1) Response of consumers and (2) cost of receiving - handling - and placing merchandise for sale.






8. The awareness of the consumer to what they perceive to be the window of cost within which they will buy a particular product or service






9. The higher the ratio the quicker current liabilities can be paid. This ratio also indicates the margin of safety a retailer has on hand to cover possible shrinkages






10. The retailers financial condition at a specific point in time






11. (Cash + Accounts Receivable) / Current Liabilities






12. Statistical forecasting tool that helps retailers to predict how apparel markdowns may affect the bottom-line business and objectives before the markdowns are implemented.






13. Inventory Valuation Method where the cost to the retailer of each item purchased from a vendor is entered in the accounting system and/or placed on the merchandise item or on it's package. At times - freight charges are built into the cost. Coding of






14. Amount of markdown usually less - take the loss early will be easier - strengthen goodwill - replenish stock in lower price lines - leads to higher stock turnover - higher likelihood merchandise will sell in a timely manner






15. Net dollar markdown/ net dollar selling price






16. Inventory Valuation Method that combines taking inventory at retail prices and adjusting the cost value to reflect current retail value. 5 Steps Involved.






17. First price or Manufacturers suggestet Retal Price (MSRP)






18. The extent to which a retailer is using debt or borrowed funds to operate the business. (The higher the FLR the higher the debt)






19. The largest sum of money in current assets. Can be presented in either cost or retail terms. Should be purchased for a short period of time - as products lose monetary value over time and are subject to markdowns.






20. Current Assets/ Current Liabilities






21. The weather - merchandise is shopworn - economic downturn






22. Debts owned by a retailer that require payment over an extended period of time (Fixtures - equipment - and property)






23. Assets collected within one year. Due to the widespread use of credit cards - AR for retailers has diminished with exceptions such as lay-a-way.






24. Costs involved in running the business






25. In the Cost Method. Merchandise most recently purchased is assumed to have been sold first. Therefore - the ending inventory reflects the items in stock for the longest period of time. Produces lowest ending inventory value and highest cost of goods






26. What the retailer owns in monetary value






27. Assesses the retailers ability to realize adequate return on the money that is invested by the retail owner.






28. Ranges of prices that appeals for a particular group of consumers






29. Dollar markup ($)/ cost price ($)






30. An aggregate of the original selling price. Should cover all expenses of the store - desired profit - take into account price reductions - alteration costs.






31. Price change that results in reestablishing the original retail price to merchandise after it was temporarily marked down






32. To make a profit buyers must set an appropriate price considering many variables and using past experience and knowledge of future trends. A markup on an item does not typically remain constant.






33. The number of items remaining in stock x dollar markdown






34. Buying errors - promotion errors - pricing errors - uncontrollable errors






35. Statistical forecasting tool that helps retailers to predict how apparel markdowns may affect the bottom-line business and objectives before the markdowns are implemented






36. Temporary price reduction for a specific period of time for the express purpose of generating store traffic and sales. Prices return to original retail price at end of sale period.






37. The value of this calculation is that consumers can understand the price reduction when the retailer is promoting this merchandise.






38. The energizing force that fuels and sustains our economic system






39. Total Expenses/ Net Sales






40. (planned expenses + planned operating profit + planned stock shortages + markdowns + employee and customer discounts) / (planned net sales + stock shortages + markdowns + employee and customer discounts) x 100%






41. Price is changed (up or down)






42. Cost Price/ (100%-markup %)






43. Improper displays - merchandise returns due to high pressure selling






44. Beggining inventory for a time period+ purchases=merchandise available for sale- ending inventory






45. Wrong Merchandise - odd assortment colors/sizes - seasonal goods






46. Merchandise Available for sale at cost/ Merchandise available for sale at retail






47. When new styles or models come out every year - thus forcing the obsolescence of the previous year's model






48. Represents the total dollar markdown as a percentage of total dollar net sales. This is typically not for an individual item.






49. The prices from lowest to highest that are carried within a merchandise category






50. Price Lining - price zones - price ranges