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






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






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






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






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






6. Sales for the period/ average inventory






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






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






9. Price is changed (up or down)






10. 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






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






12. 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






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






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






15. 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






16. Short time - like 1 or 2 day sales






17. 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






18. 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.






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






20. 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.






21. Cash Received by the retailer-cash leaving the retailer






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






23. One that is just enough to move the goods






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






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






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






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






28. Costs involved in running the business






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






30. Evaluates the managament of capital






31. 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






32. Dollar markup ($)/ retail price ($)






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






34. 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.






35. Liabilities+ Owner's equity or net worth






36. 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






37. 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






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






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






40. Price Lining - price zones - price ranges






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






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






43. 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






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






45. Financial debts incurred by a retailer






46. 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






47. Total Assets/ Net Worth






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






49. Current Assets/ Current Liabilities






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