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






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






3. 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






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






5. 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






6. 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.






7. Price is changed (up or down)






8. What the retailer owns in monetary value






9. 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.






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






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






12. 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






13. The weather - merchandise is shopworn - economic downturn






14. Net Profit After Taxes/ Net Worth






15. Wrong Merchandise - odd assortment colors/sizes - seasonal goods






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






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






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






20. (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%






21. 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.






22. Total Expenses/ Net Sales






23. Net Profit/ Net Sales






24. (Cash + Accounts Receivable) / Current Liabilities






25. Price Lining - price zones - price ranges






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






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






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






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






30. 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






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






32. Costs involved in running the business






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






34. Net Profit After Taxes/ Total Assets






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






36. 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






37. Liabilities+ Owner's equity or net worth






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






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






40. One that is just enough to move the goods






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






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






43. Financial debts incurred by a retailer






44. Revenues received by a retailer






45. 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






46. Sales for the period/ average inventory






47. 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






48. Merchandise Available for sale at cost/ Merchandise available for sale at retail






49. Current Liabilites/ Net Worth






50. Net dollar markdown/ net dollar selling price