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 ($)/ retail price ($)






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






3. Net Profit After Taxes/ Net Worth






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






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






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






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






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






9. 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.






10. 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






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






12. Net Profit After Taxes/ Total Assets






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






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






15. 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.






16. Short time - like 1 or 2 day sales






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






18. 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.






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






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






22. Cost + Markup






23. 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






24. Current Assets/ Current Liabilities






25. Evaluates the managament of capital






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






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






28. (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%






29. One that is just enough to move the goods






30. Liabilities+ Owner's equity or net worth






31. Original Retail price- markdown selling price






32. 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






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






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






35. Price is changed (up or down)






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






37. Net Profit/ Net Sales






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






39. What the retailer owns in monetary value






40. Current Liabilites/ Net Worth






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






42. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






44. Sales less cost of goods sold






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






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






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






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






49. 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






50. (Cash + Accounts Receivable) / Current Liabilities