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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. The energizing force that fuels and sustains our economic system






2. (Cash + Accounts Receivable) / Current Liabilities






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






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.






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






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






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






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






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






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






11. 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






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






13. 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






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






15. 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.






16. Original Retail price- markdown selling price






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






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






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






20. Current Liabilites/ Net Worth






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






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






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






24. Net dollar markdown/ net dollar selling price






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






26. Costs involved in running the business






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






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






29. Current Assets/ Current Liabilities






30. Net Profit After Taxes/ Total Assets






31. All of the capital used in operating the store - whether provided by the owners or creditors (vendors - banks)






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






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






34. 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.






35. Strategy employed by retailers to buy and carry a predetermined number of price lines for a category of merchandise






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






37. (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%






38. 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.






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






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






41. 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.






42. Cost + Markup






43. 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






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






45. Sales for the period/ average inventory






46. Buying errors - promotion errors - pricing errors - uncontrollable errors






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. Price Lining - price zones - price ranges






49. The weather - merchandise is shopworn - economic downturn






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






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