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. (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%






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






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






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






5. 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






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






7. 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






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






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






10. Current Liabilites/ Net Worth






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






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






13. Sales less cost of goods sold






14. 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.






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






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






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






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






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






20. 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






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






22. Net Profit After Taxes/ Total Assets






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






24. Revenues received by a retailer






25. Net Profit After Taxes/ Net Worth






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






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






28. Short time - like 1 or 2 day sales






29. Total Expenses/ Net Sales






30. 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






31. Liabilities+ Owner's equity or net worth






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






33. 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






34. Cost + Markup






35. Financial debts incurred by a retailer






36. Can be transformed simply and rapidly into cash






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






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






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






40. Net Profit/ Net Sales






41. The weather - merchandise is shopworn - economic downturn






42. Costs involved in running the business






43. 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.






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






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






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






48. 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.






49. 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.






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