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






2. The difference between the total delivered cost and the total retail price of merchandise handled during a given period.






3. Cost + Markup






4. 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






5. Costs involved in running the business






6. The weather - merchandise is shopworn - economic downturn






7. The cost of merchandise that was sold (including the method that was used to determine cost)






8. Price is changed (up or down)






9. Net Profit After Taxes/ Net Worth






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






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






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






13. 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






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






15. Net Profit After Taxes/ Total Assets






16. Revenues received by a retailer






17. 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.






18. Current Assets/ Current Liabilities






19. When fixed assets such as fixtures and equipment are continually used and therefore lose some of their monetary value (Ex: your car)






20. Original Retail price- markdown selling price






21. (Cash + Accounts Receivable) / Current Liabilities






22. 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






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






24. Sales for the period/ average inventory






25. 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.






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






27. Total Assets/ Net Worth






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






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






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






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






32. 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






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






34. (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%






35. 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.






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






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






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






39. One that is just enough to move the goods






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






41. Usually lower than original - but held for longer period






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






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






44. Strategy employed by retailers to buy and carry a predetermined number of price lines for a category of merchandise






45. Short time - like 1 or 2 day sales






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






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






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






49. 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






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






Can you answer 50 questions in 15 minutes?



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