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






2. Net dollar markdown/ net dollar selling price






3. Price is changed (up or down)






4. Evaluates the managament of capital






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






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






7. Short time - like 1 or 2 day sales






8. The weather - merchandise is shopworn - economic downturn






9. Sales for the period/ average inventory






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






11. Price Lining - price zones - price ranges






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






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. 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






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






16. 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.






17. (Cash + Accounts Receivable) / Current Liabilities






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






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






20. Net Profit After Taxes/ Net Worth






21. 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






22. Can be transformed simply and rapidly into cash






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






24. Financial debts incurred by a retailer






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






26. 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






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






28. 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






29. Total Assets/ Net Worth






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






31. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






33. Gross margin less operating expenses=NP before taxes. Deducting taxes=NP after taxes






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






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






36. Indicates gross margin derived from the sales of merchandise and it's ability to cover operating expenses. Helps a retailer determine how much rent they should pay - what salary the owner should draw - and how much they should pay their associates.






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






38. 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.






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






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






41. 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.






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. Original Retail price- markdown selling price






44. Liabilities+ Owner's equity or net worth






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






46. 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.






47. 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.






48. Costs involved in running the business






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






50. Cost + Markup