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. Improper displays - merchandise returns due to high pressure selling






2. 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






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






4. Buying errors - promotion errors - pricing errors - uncontrollable errors






5. Also referred to as the income or operating statement. 5 Basic Elements: Net Sales - Cost of Goods sold - Gross Margin - Operating Expenses - Net profit






6. (Cash + Accounts Receivable) / Current Liabilities






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






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






9. 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






10. 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






11. 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






12. 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.






13. Net Profit After Taxes/ Net Worth






14. Original Retail price- markdown selling price






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






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






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






18. Liabilities+ Owner's equity or net worth






19. Total Assets/ Net Worth






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






21. 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






22. One that is just enough to move the goods






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






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






25. Sales for the period/ average inventory






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






27. Current Liabilites/ Net Worth






28. Net Profit/ Net Sales






29. 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.






30. 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






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






32. Current Assets/ Current Liabilities






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






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






35. Evaluates the managament of capital






36. What the retailer owns in monetary value






37. Price Lining - price zones - price ranges






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






39. Sales less cost of goods sold






40. (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%






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






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






43. 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.






44. Basic premise is to increase profits through more sales without an increase in inventory. Inventory is expressed in cost terms rather than cost percent - because it is related to investment dollars in gross margin - it should be expressed in cost num






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






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






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






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






49. Revenues received by a retailer






50. 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