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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. Cost + Markup






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






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






4. 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.






5. Original Retail price- markdown selling price






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






7. What the retailer owns in monetary value






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






9. Financial debts incurred by a retailer






10. Net dollar markdown/ net dollar selling price






11. 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.






12. Can be transformed simply and rapidly into cash






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. 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






15. Sales less cost of goods sold






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






17. 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






18. Total Assets/ Net Worth






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






20. Net Profit After Taxes/ Net Worth






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






22. 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






23. Total Expenses/ Net Sales






24. Price is changed (up or down)






25. 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.






26. Short time - like 1 or 2 day sales






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






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






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






30. Current Liabilites/ Net Worth






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






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






33. 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






34. 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






35. Net Profit After Taxes/ Total Assets






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






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






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






39. 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.






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






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






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






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






44. 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






45. Revenues received by a retailer






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






47. Evaluates the managament of capital






48. Price Lining - price zones - price ranges






49. One that is just enough to move the goods






50. 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.







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