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. 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.






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






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






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






5. Original Retail price- markdown selling price






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






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






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






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






11. Can be transformed simply and rapidly into cash






12. One that is just enough to move the goods






13. Liabilities+ Owner's equity or net worth






14. Net Profit After Taxes/ Total Assets






15. 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






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






17. What the retailer owns in monetary value






18. Total Expenses/ Net Sales






19. (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%






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






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






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






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






24. 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






25. 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.






26. (Cash + Accounts Receivable) / Current Liabilities






27. Net Profit/ Net Sales






28. Current Assets/ Current Liabilities






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






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






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






32. Evaluates the managament of capital






33. The weather - merchandise is shopworn - economic downturn






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






35. 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






36. 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






37. Financial debts incurred by a retailer






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






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






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






41. 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






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






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






44. Short time - like 1 or 2 day sales






45. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






47. Current Liabilites/ Net Worth






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






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






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