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. Total Markup on all goods on hand/ retail price of all goods on hand






2. Can be transformed simply and rapidly into cash






3. Current Assets/ Current Liabilities






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






5. All of the capital used in operating the store - whether provided by the owners or creditors (vendors - banks)






6. Buying errors - promotion errors - pricing errors - uncontrollable errors






7. 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






8. Cost + Markup






9. Net Profit After Taxes/ Net Worth






10. Original Retail price- markdown selling price






11. Revenues received by a retailer






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






13. AKA Return on Sales - Profit analysis; Indicates the extend to which retailers have the ability to cover their expenses and earn a profit - as well as a buyers ability to purchase the correct assortment of merchandise






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






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






16. Evaluates the managament of capital






17. One that is just enough to move the goods






18. Examines the financial health of a retailer - as one of the best indicators of having too much debt in relationship to net worth. Comparres the money that vendors or banks are risking with the money that the retail owners have invested in their opera






19. Price Lining - price zones - price ranges






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






21. 1. Determine merchandise available for sale at both cost and retail prices. 2.Calculate the cost to retail complement or percentage relationship of the cost of merchandise to the selling price. 3. Subtract markdowns taken during the period. 4. Determ






22. 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.






23. Also referred to as the income or operating statement. 5 Basic Elements: Net Sales - Cost of Goods sold - Gross Margin - Operating Expenses - Net profit






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






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






26. Priced too high initially - priced too low - selling price of competitors






27. Reduction in price of an item - if that item is sold - the result is a lower monetary intake for that item






28. 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.






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






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






31. Basic premise is to increase profits through more sales without an increase in inventory. Inventory is expressed in cost terms rather than cost percent - because it is related to investment dollars in gross margin - it should be expressed in cost num






32. Total Assets/ Net Worth






33. 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






34. Net dollar markdown/ net dollar selling price






35. Costs involved in running the business






36. In Cost Method. Merchandise sold during a time period is assumed to be sold in the order the merchandise was received. Merchandise on hand for the longest period of time is sold first. Therefore - the ending inventory reflects the items in stock for






37. Based on a calculation commonly represented as a percentage - comparing the amount of inventory a retailer receives from a manufacturer or supplier against what is actually sold to the consumer






38. 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.






39. Merchandise will sell at highest price longer period of time - appear exclusive - sale of goods at regular price is not disrupted - greater amount of goods can be accumulated and then marked down.






40. Ensures that there is enough cash to pay debts. Any time the ratio is colse to 1 - the retailer is said to be in a liquid position.






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






42. Net Profit After Taxes/ Total Assets






43. Total Expenses/ Net Sales






44. Short time - like 1 or 2 day sales






45. (gross margin % x Turnover) / (100%-markup %)






46. 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.






47. What the retailer owns in monetary value






48. Sales for the period/ average inventory






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






50. Financial obligations that require payment within a short period of time (Wages - utitilites - Insurance)