SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
Test your basic knowledge |
Retail Financials
Start Test
Study First
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. Strategy employed by retailers to buy and carry a predetermined number of price lines for a category of merchandise
Ideal Markdown
Pricing Strategies: Price Lining
Pricing Errors
Liabilities
2. Net Profit After Taxes/ Total Assets
Retail Price Formula
Depreciation
Adage of Profitability for Retailers
Return on Assets (ROA) Formul
3. When fixed assets such as fixtures and equipment are continually used and therefore lose some of their monetary value (Ex: your car)
Depreciation
Pricing Depends on 2 factors
Inventory
Profit Margin Analysis Formula
4. Total Expenses/ Net Sales
Expense Ratio
Expense Ratio Formula
Temporary Price Reduction
Fixed Assets
5. 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
Turnover Rate Formula
Profit Margin
Liabilities
Inventory
6. When new styles or models come out every year - thus forcing the obsolescence of the previous year's model
Forced Obsolescence
Dollar Markdown Formula
Markdown Cancellation ($) Formula
Cumulative Markup % Formula
7. Liabilities+ Owner's equity or net worth
Early Markdowns
Assets Formula
Initial Markup (IMU)
Promotional Markdown
8. Price change that results in reestablishing the original retail price to merchandise after it was temporarily marked down
Current Assets
Markdown Percentage
Markdown Cancellations
Accounts Receivable (AR)
9. What the retailer owns in monetary value
Markdown Optimization
Profit and Loss Statement (P&L Statement)
Expense Ratio Formula
Assets
10. The retailers financial condition at a specific point in time
Balance Sheet
Early Markdowns
Inventory
Operating Expenses
11. Net Profit/ Net Sales
Dollar Markdown Formula
Profit Margin Analysis Formula
Expense Ratio
Promotional Markdown
12. The energizing force that fuels and sustains our economic system
Profit and Loss Statement (P&L Statement)
Operating Expenses
Net Profit
Profit
13. Short time - like 1 or 2 day sales
Return on Net Worth (RONW) Formula
Temporary Price Reduction
Initial Markup (IMU)
Cost Complement Formula
14. Sales less cost of goods sold
Cost of Goods Sold (COGS) Formula
Gross Margin
New Price
Pricing Depends on 2 factors
15. Inventory Valuation Method that combines taking inventory at retail prices and adjusting the cost value to reflect current retail value. 5 Steps Involved.
Initial Markup (IMU)
Retail Inventory Method
Debt Equity Ratio
Uncontrollable Errors
16. Total Assets/ Net Worth
Financial Leverage Ratio Formula
Cumulative Markup
Pricing Strategies
Markdown Percentage
17. Total Markup on all goods on hand/ retail price of all goods on hand
Cumulative Markup % Formula
Pricing Strategies: Price Ranges
Planned Initial Markup % Formula
Cost of Goods Sold (COGS) Formula
18. Cash Received by the retailer-cash leaving the retailer
Balance Sheet
Selling Price Formula
Cash Flow Formula
Fixed Assets
19. Statistical forecasting tool that helps retailers to predict how apparel markdowns may affect the bottom-line business and objectives before the markdowns are implemented.
Reasons for taking Markdowns
Markdown Optimization
Cost of Goods Sold (COGS) Formula
Forced Obsolescence
20. Sales for the period/ average inventory
Uncontrollable Errors
Turnover Rate Formula
Acid test or Quick Ratio
Gross Margin Return on Inventory Investment-GMROI Formula
21. Can be transformed simply and rapidly into cash
Balance Sheet
Markdown Percentage
Markup % of Retail Formula
Current Assets
22. Assesses the retailers ability to realize adequate return on the money that is invested by the retail owner.
Current Ratio (CR) Formula
Return on Net Worth
Pricing Depends on 2 factors
New Price
23. Price Lining - price zones - price ranges
Pricing Strategies
New Price
Return on Assets (ROA) Formul
Financial Leverage Ratio Formula
24. Net dollar markdown/ net dollar selling price
Assets
FIFO (First in - First out)
Pricing Strategies
Markdown Percentage Formula
25. Current Liabilites/ Net Worth
Debt Equity Ratio Formula
Return on Net Worth
Markdown Cancellations
Cost Complement Formula
26. Cost + Markup
Markdown Optimization
Price Sensitivity
Ideal Markdown
Selling Price Formula
27. Ranges of prices that appeals for a particular group of consumers
Pricing Strategies: Price Zones
Return on Net Worth (RONW) Formula
Markdown optimization
Profit
28. The weather - merchandise is shopworn - economic downturn
Markup % of Retail Formula
Markdown Cancellation ($) Formula
Uncontrollable Errors
Cost of Goods Sold (COGS) Formula
29. 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
Clearance Markdowns
Profit Margin
Markdown Percentage
Pricing Errors
30. An aggregate of the original selling price. Should cover all expenses of the store - desired profit - take into account price reductions - alteration costs.
Initial Markup (IMU)
GMROII (Gross Margin Return on Inventory Investment)
Markdown optimization
Clearance Markdowns
31. Buying errors - promotion errors - pricing errors - uncontrollable errors
Reasons for taking Markdowns
Pricing Strategies: Price Lining
Debt Equity Ratio Formula
Depreciation
32. 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
Price Sensitivity
Profit
Turnover Rate Formula
Return on Net Worth (RONW) Formula
33. Priced too high initially - priced too low - selling price of competitors
Current Ratio (CR) Formula
The Cost Method
Pricing Errors
Markdown Optimization
34. Cost Price/ (100%-markup %)
5 Steps of Retail Inventory Method
Fixed Assets
Retail Price Formula
Return on Net Worth
35. (Cash + Accounts Receivable) / Current Liabilities
Off-Price Markdown Percentage Formula
Acid Test or Quick Ratio (QR) Formula
Fixed Assets
Pricing Depends on 2 factors
36. The value of this calculation is that consumers can understand the price reduction when the retailer is promoting this merchandise.
Pricing Errors
Off-Price Markdowns
Clearance Markdowns
Assets
37. (1) Response of consumers and (2) cost of receiving - handling - and placing merchandise for sale.
Reasons for taking Markdowns
Temporary Price Reduction
Gross Margin
Pricing Depends on 2 factors
38. Price is changed (up or down)
Markdown Cancellations
Markdown Percentage
New Price
Profit and Loss Statement (P&L Statement)
39. 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
Turnover Rate Formula
Fixed Assets
Markdown
Current Ratio
40. Statistical forecasting tool that helps retailers to predict how apparel markdowns may affect the bottom-line business and objectives before the markdowns are implemented
New Price
Financial Leverage Ratio Formula
Accounts Receivable (AR)
Markdown optimization
41. Beggining inventory for a time period+ purchases=merchandise available for sale- ending inventory
Promotion Errors
Cost of Goods Sold (COGS) Formula
Balance Sheet
Selling Price Formula
42. All of the capital used in operating the store - whether provided by the owners or creditors (vendors - banks)
Early Markdowns
Fixed Assets
Accounts Receivable (AR)
Return on Assets
43. 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.
Markup % of Retail Formula
Clearance Markdowns
Promotional Markdown
Fixed Liabilities
44. 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
Buying Errors
FIFO (First in - First out)
Gross Margin
Current Assets
45. Debts owned by a retailer that require payment over an extended period of time (Fixtures - equipment - and property)
Reasons for taking Markdowns
Price Sensitivity
Return on Sales
Fixed Liabilities
46. (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%
Depreciation
Retail Inventory Method
Planned Initial Markup % Formula
Profit Margin Analysis Formula
47. Dollar markup ($)/ cost price ($)
Markdown
Markup % of Cost Formula
Markdown Percentage
Net Profit
48. Dollar Markdown of Merchandise/ original retail selling price of merchandise being marked down
Return on Assets (ROA) Formul
Markdown optimization
Cost of Goods Sold (COGS) Formula
Off-Price Markdown Percentage Formula
49. Merchandise Available for sale at cost/ Merchandise available for sale at retail
Retail Price Formula
Operating Expenses
Dollar Markdown Formula
Cost Complement Formula
50. Having the right merchandise - at the right time - for the right price - in the right place
Cost of Goods Sold
Accounts Receivable (AR)
Planned Initial Markup % Formula
Adage of Profitability for Retailers