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. Sales less cost of goods sold






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






3. Price Lining - price zones - price ranges






4. The weather - merchandise is shopworn - economic downturn






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






6. 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






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






8. Having the right merchandise - at the right time - for the right price - in the right place






9. Evaluates the managament of capital






10. Net Profit After Taxes/ Net Worth






11. 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






12. Indicates gross margin derived from the sales of merchandise and it's ability to cover operating expenses. Helps a retailer determine how much rent they should pay - what salary the owner should draw - and how much they should pay their associates.






13. 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.






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






15. 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






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






17. 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






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






19. Net dollar markdown/ net dollar selling price






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






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






22. 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






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






24. Can be transformed simply and rapidly into cash






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






26. Cost + Markup






27. What the retailer owns in monetary value






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






29. Current Liabilites/ Net Worth






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






31. Revenues received by a retailer






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






33. Total Assets/ Net Worth






34. 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.






35. Total Expenses/ Net Sales






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






37. Current Assets/ Current Liabilities






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






39. 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.






40. 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






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






42. One that is just enough to move the goods






43. Costs involved in running the business






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






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






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






47. 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






48. (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%






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






50. 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