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






2. Financial debts incurred by a retailer






3. Net dollar markdown/ net dollar selling price






4. Revenues received by a retailer






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






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






7. 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






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






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






10. 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.






11. Net Profit After Taxes/ Net Worth






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






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






15. (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%






16. 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.






17. 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.






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






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






20. What the retailer owns in monetary value






21. Net Profit After Taxes/ Total Assets






22. 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






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






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






25. Current Assets/ Current Liabilities






26. Sales for the period/ average inventory






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






28. Total Expenses/ Net Sales






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






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






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






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






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






34. Price Lining - price zones - price ranges






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






36. 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






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






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






39. Total Assets/ Net Worth






40. Evaluates the managament of capital






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






42. Can be transformed simply and rapidly into cash






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






44. 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






45. 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






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






47. 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






48. (Cash + Accounts Receivable) / Current Liabilities






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






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