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






2. Total Assets/ Net Worth






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






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






5. (Cash + Accounts Receivable) / Current Liabilities






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






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






8. 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






9. Current Assets/ Current Liabilities






10. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






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






13. 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






14. Liabilities+ Owner's equity or net worth






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






16. What the retailer owns in monetary value






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






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






19. 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






20. Revenues received by a retailer






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






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






23. Costs involved in running the business






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






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






26. Sales for the period/ average inventory






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






28. Price reduction for merchandise that has not lived up to buyers' expectations. Includes broken assortments of merchandise - merchandise lines that buyers no longer want to carry - shopworn goods - items that haven't sold because of an event beyond bu






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






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






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






32. Original Retail price- markdown selling price






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






34. 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.






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






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






37. Cost + Markup






38. One that is just enough to move the goods






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. 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






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






42. 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






43. Price Lining - price zones - price ranges






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






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






46. Net dollar markdown/ net dollar selling price






47. Net Profit/ Net Sales






48. Price is changed (up or down)






49. 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






50. Dollar Markdown of Merchandise/ original retail selling price of merchandise being marked down