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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. (Cash + Accounts Receivable) / Current Liabilities






2. 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.






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






4. 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






5. Assets collected within one year. Due to the widespread use of credit cards - AR for retailers has diminished with exceptions such as lay-a-way.






6. Net dollar markdown/ net dollar selling price






7. 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






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






9. Can be transformed simply and rapidly into cash






10. 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.






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






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






13. Net Profit/ Net Sales






14. Current Liabilites/ Net Worth






15. Liabilities+ Owner's equity or net worth






16. Financial debts incurred by a retailer






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






18. 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






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






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






21. Costs involved in running the business






22. Revenues received by a retailer






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






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






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






26. Current Assets/ Current Liabilities






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






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






29. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






31. 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






32. Price Lining - price zones - price ranges






33. Original Retail price- markdown selling price






34. 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.






35. 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






36. The difference between the total delivered cost and the total retail price of merchandise handled during a given period.






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






38. Sales less cost of goods sold






39. Net Profit After Taxes/ Total Assets






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






41. Net Profit After Taxes/ Net Worth






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






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






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






45. Evaluates the managament of capital






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. Usually lower than original - but held for longer period






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






49. Cost + Markup






50. Total Expenses/ Net Sales







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