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






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






3. Liabilities+ Owner's equity or net worth






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






5. 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






6. What the retailer owns in monetary value






7. Financial debts incurred by a retailer






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






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






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






11. Net Profit/ Net Sales






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






13. Cost + Markup






14. Current Liabilites/ Net Worth






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






16. 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






17. 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.






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






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






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






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






22. Total Assets/ Net Worth






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






24. Costs involved in running the business






25. Net Profit After Taxes/ Net Worth






26. Can be transformed simply and rapidly into cash






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






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






29. 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.






30. Evaluates the managament of capital






31. Short time - like 1 or 2 day sales






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






33. 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.






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






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






36. Sales less cost of goods sold






37. Net dollar markdown/ net dollar selling price






38. 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






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






40. Original Retail price- markdown selling price






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






42. 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






43. 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






44. 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.






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






46. 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






47. 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






48. Price Lining - price zones - price ranges






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






50. 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