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






2. 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






3. Total Assets/ Net Worth






4. 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.






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






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






7. Original Retail price- markdown selling price






8. Net Profit/ Net Sales






9. 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.






10. 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.






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






12. 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






13. Sales for the period/ average inventory






14. 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






15. The number of items remaining in stock x dollar markdown






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






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






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






19. Price is changed (up or down)






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






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






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






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






24. Short time - like 1 or 2 day sales






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






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






27. One that is just enough to move the goods






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






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






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






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






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






33. Current Liabilites/ Net Worth






34. 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






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






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






37. Current Assets/ Current Liabilities






38. 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.






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






40. 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.






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






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






43. Total Expenses/ Net Sales






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






45. 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






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






47. Net dollar markdown/ net dollar selling price






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






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






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