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






2. Costs involved in running the business






3. 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






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






5. Current Liabilites/ Net Worth






6. 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.






7. Short time - like 1 or 2 day sales






8. Sales for the period/ average inventory






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






10. 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






11. 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






12. 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.






13. Liabilities+ Owner's equity or net worth






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






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






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






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






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






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






20. 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






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






22. Financial debts incurred by a retailer






23. Net Profit/ Net Sales






24. 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.






25. One that is just enough to move the goods






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






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






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






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






30. Original Retail price- markdown selling price






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






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






33. Price Lining - price zones - price ranges






34. 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






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. Assesses the retailers ability to realize adequate return on the money that is invested by the retail owner.






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






38. Net Profit After Taxes/ Net Worth






39. 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






40. 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






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






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






43. Net dollar markdown/ net dollar selling price






44. What the retailer owns in monetary value






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






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






47. Total Assets/ Net Worth






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






49. (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%






50. Total Expenses/ Net Sales