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. Price is changed (up or down)






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






4. 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.






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






6. Net dollar markdown/ net dollar selling price






7. 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






8. 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






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






10. Total Expenses/ Net Sales






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






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






13. 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.






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






15. One that is just enough to move the goods






16. Current Assets/ Current Liabilities






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






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






19. Costs involved in running the business






20. 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






21. Current Liabilites/ Net Worth






22. Short time - like 1 or 2 day sales






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






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






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






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






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






28. Price Lining - price zones - price ranges






29. Sales for the period/ average inventory






30. (Cash + Accounts Receivable) / Current Liabilities






31. 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.






32. Net Profit After Taxes/ Net Worth






33. 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.






34. 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






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






36. Revenues received by a retailer






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






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






39. 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






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






41. Cost + Markup






42. Financial debts incurred by a retailer






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






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






45. 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






46. Net Profit After Taxes/ Total Assets






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






48. (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%






49. Can be transformed simply and rapidly into cash






50. 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