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Test your basic knowledge |
Retail Financials
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Study First
Subject
:
business-skills
Instructions:
Answer 50 questions in 15 minutes.
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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. Beggining inventory for a time period+ purchases=merchandise available for sale- ending inventory
Current Liabilities
Cost of Goods Sold (COGS) Formula
Acid test or Quick Ratio
Markup
2. The cost of merchandise that was sold (including the method that was used to determine cost)
Return on Assets
Net Sales
Cost of Goods Sold
Pricing Strategies: Price Lining
3. 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.
Late Markdowns
Ideal Markdown
Liabilities
Pricing Strategies: Price Ranges
4. Statistical forecasting tool that helps retailers to predict how apparel markdowns may affect the bottom-line business and objectives before the markdowns are implemented.
Promotional Markdown
Net Profit
Markdown Optimization
Original Price
5. 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
Retail Inventory Method
Pricing Strategies: Price Lining
Current Ratio
Markdown Cancellations
6. Buying errors - promotion errors - pricing errors - uncontrollable errors
Reasons for taking Markdowns
Profit
Accounts Receivable (AR)
Promotion Errors
7. Usually lower than original - but held for longer period
Pricing Strategies: Price Lining
Regular Price
Financial Leverage Ratio Formula
Balance Sheet
8. Having the right merchandise - at the right time - for the right price - in the right place
Markdown Cancellation ($) Formula
Ideal Markdown
Balance Sheet
Adage of Profitability for Retailers
9. The difference between the total delivered cost and the total retail price of merchandise handled during a given period.
Markdown Optimization
Net Sales
Cumulative Markup
Inventory
10. Inventory Valuation Method where the cost to the retailer of each item purchased from a vendor is entered in the accounting system and/or placed on the merchandise item or on it's package. At times - freight charges are built into the cost. Coding of
Cost of Goods Sold
The Cost Method
Cost Complement Formula
Financial Leverage Ratio
11. One that is just enough to move the goods
Ideal Markdown
Net Sales
Markdown
Adage of Profitability for Retailers
12. An aggregate of the original selling price. Should cover all expenses of the store - desired profit - take into account price reductions - alteration costs.
Pricing Strategies: Price Lining
Late Markdowns
Initial Markup (IMU)
The Cost Method
13. Total Assets/ Net Worth
Fixed Assets
Financial Leverage Ratio Formula
Markdown Cancellation ($) Formula
Turnover Rate Formula
14. (1) Response of consumers and (2) cost of receiving - handling - and placing merchandise for sale.
Pricing Depends on 2 factors
The Cost Method
Gross Margin Return on Inventory Investment-GMROI Formula
Buying Errors
15. The number of items remaining in stock x dollar markdown
Cost of Goods Sold
Promotional Markdown
Markdown Cancellation ($) Formula
Buying Errors
16. Wrong Merchandise - odd assortment colors/sizes - seasonal goods
Markdown Percentage Formula
Uncontrollable Errors
Cost of Goods Sold
Buying Errors
17. Debts owned by a retailer that require payment over an extended period of time (Fixtures - equipment - and property)
Selling Price Formula
Fixed Liabilities
Net Profit
Liabilities
18. Sales less cost of goods sold
Gross Margin
Pricing Errors
Original Price
Return on Net Worth
19. To make a profit buyers must set an appropriate price considering many variables and using past experience and knowledge of future trends. A markup on an item does not typically remain constant.
Initial Markup (IMU)
Inventory
Markup
Liabilities
20. What the retailer owns in monetary value
Accounts Receivable (AR)
Assets
Pricing Errors
Markup % of Retail Formula
21. Dollar markup ($)/ cost price ($)
Uncontrollable Errors
Markup % of Cost Formula
Net Sales
Temporary Price Reduction
22. Can be transformed simply and rapidly into cash
Current Assets
Liabilities
Operating Expenses
Off-Price Markdown Percentage Formula
23. Dollar markup ($)/ retail price ($)
Dollar Markdown Formula
Profit
Depreciation
Markup % of Retail Formula
24. Original Retail price- markdown selling price
GMROII (Gross Margin Return on Inventory Investment)
Dollar Markdown Formula
Markdown Cancellations
Markdown Optimization
25. When new styles or models come out every year - thus forcing the obsolescence of the previous year's model
Loss-Leader
Forced Obsolescence
Profit
Pricing Depends on 2 factors
26. Sales for the period/ average inventory
Turnover Rate Formula
Selling Price Formula
Retail Price Formula
Current Assets
27. Liabilities+ Owner's equity or net worth
Markdown optimization
Pricing Strategies: Price Lining
Assets Formula
Retail Price Formula
28. (gross margin % x Turnover) / (100%-markup %)
Inventory
Markdown optimization
Profit Margin
Gross Margin Return on Inventory Investment-GMROI Formula
29. Cost Price/ (100%-markup %)
Retail Price Formula
Profit Margin
Off-Price Markdowns
Markdown Cancellations
30. Total Expenses/ Net Sales
Pricing Errors
Cash Flow Formula
Regular Price
Expense Ratio Formula
31. 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
Clearance Markdowns
Current Assets
Markdown Optimization
Price Sensitivity
32. Inventory Valuation Method that combines taking inventory at retail prices and adjusting the cost value to reflect current retail value. 5 Steps Involved.
Clearance Markdowns
Gross Margin
Retail Inventory Method
5 Steps of Retail Inventory Method
33. Net Profit/ Net Sales
Current Liabilities
Regular Price
Markdown Percentage Formula
Profit Margin Analysis Formula
34. (Cash + Accounts Receivable) / Current Liabilities
Acid Test or Quick Ratio (QR) Formula
Loss-Leader
Original Price
Current Ratio (CR) Formula
35. Strategy employed by retailers to buy and carry a predetermined number of price lines for a category of merchandise
New Price
Pricing Strategies: Price Lining
Expense Ratio
Return on Assets (ROA) Formul
36. Short time - like 1 or 2 day sales
Temporary Price Reduction
Cost of Goods Sold
Markdown Percentage
Markdown Cancellation ($) Formula
37. Price Lining - price zones - price ranges
Pricing Strategies
Current Assets
Dollar Markdown Formula
Current Ratio
38. The prices from lowest to highest that are carried within a merchandise category
Profit and Loss Statement (P&L Statement)
Pricing Depends on 2 factors
Pricing Strategies: Price Ranges
Ideal Markdown
39. The value of this calculation is that consumers can understand the price reduction when the retailer is promoting this merchandise.
Acid test or Quick Ratio
Off-Price Markdowns
Dollar Markdown Formula
Pricing Strategies: Price Lining
40. The weather - merchandise is shopworn - economic downturn
Cost Complement Formula
Cumulative Markup % Formula
Uncontrollable Errors
Cost of Goods Sold (COGS) Formula
41. Dollar Markdown of Merchandise/ original retail selling price of merchandise being marked down
Early Markdowns
Off-Price Markdown Percentage Formula
Inventory
Financial Leverage Ratio Formula
42. Priced too high initially - priced too low - selling price of competitors
Pricing Errors
Reasons for taking Markdowns
Original Price
Cost Complement Formula
43. 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
Off-Price Markdowns
Pricing Strategies: Price Zones
Return on Net Worth
Sell-Through Rate
44. Current Assets/ Current Liabilities
Cost of Goods Sold (COGS) Formula
Turnover Rate Formula
Current Ratio (CR) Formula
Current Assets
45. Current Liabilites/ Net Worth
Profit Margin Analysis Formula
Clearance Markdowns
Debt Equity Ratio Formula
Profit Margin
46. 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.
Accounts Receivable (AR)
Regular Price
Markup % of Retail Formula
Profit and Loss Statement (P&L Statement)
47. Price change that results in reestablishing the original retail price to merchandise after it was temporarily marked down
Turnover Rate Formula
Debt Equity Ratio Formula
Markdown Cancellations
Markdown Percentage Formula
48. The energizing force that fuels and sustains our economic system
Dollar Markdown Formula
Debt Equity Ratio Formula
Profit
Acid test or Quick Ratio
49. Net Profit After Taxes/ Total Assets
Return on Assets (ROA) Formul
Current Assets
Regular Price
Forced Obsolescence
50. Price is changed (up or down)
New Price
Planned Initial Markup % Formula
Current Ratio
Markdown Cancellation ($) Formula
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