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. (Cash + Accounts Receivable) / Current Liabilities






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






3. Price is changed (up or down)






4. Financial debts incurred by a retailer






5. Total Assets/ Net Worth






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






7. Evaluates the managament of capital






8. 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






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






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






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






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






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






14. Net Profit After Taxes/ Net Worth






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






16. (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%






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






18. Net dollar markdown/ net dollar selling price






19. Current Assets/ Current Liabilities






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






21. Sales for the period/ average inventory






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






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






24. What the retailer owns in monetary value






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






26. Short time - like 1 or 2 day sales






27. Sales less cost of goods sold






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






29. 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






30. Net Profit/ Net Sales






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






32. 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






33. 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.






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






35. 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






36. 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






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






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






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






40. Price reduction for merchandise that has not lived up to buyers' expectations. Includes broken assortments of merchandise - merchandise lines that buyers no longer want to carry - shopworn goods - items that haven't sold because of an event beyond bu






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






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






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






44. Total Expenses/ Net Sales






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






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






47. Net Profit After Taxes/ Total Assets






48. 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.






49. Original Retail price- markdown selling price






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