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. Revenues received by a retailer






2. Net Profit After Taxes/ Net Worth






3. The weather - merchandise is shopworn - economic downturn






4. (Cash + Accounts Receivable) / Current Liabilities






5. Price Lining - price zones - price ranges






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






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






8. Cost + Markup






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






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






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






12. Liabilities+ Owner's equity or net worth






13. 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.






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






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






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






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






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. Costs involved in running the business






20. 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






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






22. Total Assets/ Net Worth






23. 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






24. 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.






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






26. Current Assets/ Current Liabilities






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






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






29. Price is changed (up or down)






30. 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






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






32. 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.






33. Can be transformed simply and rapidly into cash






34. 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






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






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






37. 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






38. What the retailer owns in monetary value






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






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






41. Buying errors - promotion errors - pricing errors - uncontrollable errors






42. 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






43. Current Liabilites/ Net Worth






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






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






46. Total Expenses/ Net Sales






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






48. Promotional markdown that involves selling at or near cost for promotional purposes






49. One that is just enough to move the goods






50. Net Profit/ Net Sales