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






2. 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






3. 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.






4. Current Liabilites/ Net Worth






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






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






7. 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






8. Total Assets/ Net Worth






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






10. Evaluates the managament of capital






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






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






13. Net dollar markdown/ net dollar selling price






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






15. Financial debts incurred by a retailer






16. Cannot be readily converted to cash within one year. (Fixtures - equipment - land/buildings)






17. Liabilities+ Owner's equity or net worth






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






19. What the retailer owns in monetary value






20. 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






21. Net Profit/ Net Sales






22. 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






23. 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






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






25. The weather - merchandise is shopworn - economic downturn






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






27. (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%






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






29. Revenues received by a retailer






30. Short time - like 1 or 2 day sales






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






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






33. Can be transformed simply and rapidly into cash






34. Total Markup on all goods on hand/ retail price of all goods on hand






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






36. Sales less cost of goods sold






37. 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






38. 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.






39. Price Lining - price zones - price ranges






40. 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






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






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






43. Net Profit After Taxes/ Total Assets






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






45. 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.






46. Price is changed (up or down)






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






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






49. 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.






50. Sales for the period/ average inventory