SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
Test your basic knowledge |
Retail Financials
Start Test
Study First
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. Liabilities+ Owner's equity or net worth
Cost of Goods Sold (COGS) Formula
Net Sales
Assets Formula
Financial Leverage Ratio Formula
2. Inventory Valuation Method that combines taking inventory at retail prices and adjusting the cost value to reflect current retail value. 5 Steps Involved.
LIFO (last in - first out)
Promotional Markdown
Retail Inventory Method
Gross Margin
3. Gross margin less operating expenses=NP before taxes. Deducting taxes=NP after taxes
Original Price
Markdown Percentage
Markdown Cancellation ($) Formula
Net Profit
4. Improper displays - merchandise returns due to high pressure selling
Cost of Goods Sold
Assets Formula
Promotion Errors
Profit
5. 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.
Inventory
Return on Net Worth
Accounts Receivable (AR)
Off-Price Markdown Percentage Formula
6. 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
Cost of Goods Sold (COGS) Formula
Accounts Receivable (AR)
Original Price
Early Markdowns
7. Net Profit/ Net Sales
Markup
Profit Margin Analysis Formula
Gross Margin
Operating Expenses
8. Price change that results in reestablishing the original retail price to merchandise after it was temporarily marked down
Original Price
Pricing Depends on 2 factors
Acid test or Quick Ratio
Markdown Cancellations
9. Total Assets/ Net Worth
Retail Price Formula
Financial Leverage Ratio Formula
Fixed Assets
Markdown Cancellations
10. 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
Expense Ratio
Profit Margin
Ideal Markdown
Current Ratio
11. 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.
Acid test or Quick Ratio
Markdown optimization
Current Ratio
Profit Margin
12. When fixed assets such as fixtures and equipment are continually used and therefore lose some of their monetary value (Ex: your car)
Return on Net Worth (RONW) Formula
Depreciation
Late Markdowns
Current Ratio
13. Statistical forecasting tool that helps retailers to predict how apparel markdowns may affect the bottom-line business and objectives before the markdowns are implemented.
Original Price
Temporary Price Reduction
Pricing Depends on 2 factors
Markdown Optimization
14. Debts owned by a retailer that require payment over an extended period of time (Fixtures - equipment - and property)
Sell-Through Rate
Regular Price
Operating Expenses
Fixed Liabilities
15. Total Expenses/ Net Sales
Expense Ratio Formula
Pricing Strategies: Price Ranges
Cost of Goods Sold
Pricing Strategies
16. Can be transformed simply and rapidly into cash
Assets
Early Markdowns
Current Assets
Cost of Goods Sold (COGS) Formula
17. What the retailer owns in monetary value
Markup
Assets
Debt Equity Ratio Formula
GMROII (Gross Margin Return on Inventory Investment)
18. (1) Response of consumers and (2) cost of receiving - handling - and placing merchandise for sale.
Pricing Depends on 2 factors
Net Sales
Promotional Markdown
FIFO (First in - First out)
19. Assesses the retailers ability to realize adequate return on the money that is invested by the retail owner.
Operating Expenses
Retail Inventory Method
Markup % of Retail Formula
Return on Net Worth
20. Financial obligations that require payment within a short period of time (Wages - utitilites - Insurance)
Current Ratio (CR) Formula
Pricing Strategies
Markup % of Retail Formula
Current Liabilities
21. Priced too high initially - priced too low - selling price of competitors
Markdown Optimization
Pricing Errors
Financial Leverage Ratio Formula
Net Profit
22. Dollar Markdown of Merchandise/ original retail selling price of merchandise being marked down
Off-Price Markdown Percentage Formula
Ideal Markdown
Uncontrollable Errors
Pricing Strategies
23. An aggregate of the original selling price. Should cover all expenses of the store - desired profit - take into account price reductions - alteration costs.
Financial Leverage Ratio
Markup
Initial Markup (IMU)
Cash Flow Formula
24. Beggining inventory for a time period+ purchases=merchandise available for sale- ending inventory
Markup
Cost Complement Formula
Off-Price Markdowns
Cost of Goods Sold (COGS) Formula
25. Net Profit After Taxes/ Net Worth
Pricing Strategies: Price Lining
Profit Margin
Gross Margin
Return on Net Worth (RONW) Formula
26. Costs involved in running the business
Liabilities
Operating Expenses
Expense Ratio
Pricing Strategies: Price Ranges
27. Cost Price/ (100%-markup %)
Cost of Goods Sold
Planned Initial Markup % Formula
Financial Leverage Ratio Formula
Retail Price Formula
28. Current Assets/ Current Liabilities
Current Assets
Selling Price Formula
Regular Price
Current Ratio (CR) Formula
29. The extent to which a retailer is using debt or borrowed funds to operate the business. (The higher the FLR the higher the debt)
Promotion Errors
Financial Leverage Ratio
Retail Price Formula
Cash Flow Formula
30. 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.
Reasons for taking Markdowns
Acid test or Quick Ratio
Return on Net Worth
Accounts Receivable (AR)
31. (Cash + Accounts Receivable) / Current Liabilities
Loss-Leader
Acid Test or Quick Ratio (QR) Formula
Current Liabilities
Net Sales
32. Financial debts incurred by a retailer
Liabilities
Profit
Pricing Strategies
Markdown
33. 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
FIFO (First in - First out)
Debt Equity Ratio
Accounts Receivable (AR)
Planned Initial Markup % Formula
34. 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
Sell-Through Rate
Cash Flow Formula
Planned Initial Markup % Formula
Pricing Depends on 2 factors
35. Dollar markup ($)/ retail price ($)
The Cost Method
FIFO (First in - First out)
Cost of Goods Sold
Markup % of Retail Formula
36. The difference between the total delivered cost and the total retail price of merchandise handled during a given period.
Cumulative Markup
Price Sensitivity
Pricing Depends on 2 factors
Cost of Goods Sold (COGS) Formula
37. Wrong Merchandise - odd assortment colors/sizes - seasonal goods
Uncontrollable Errors
Buying Errors
Acid test or Quick Ratio
Profit and Loss Statement (P&L Statement)
38. Short time - like 1 or 2 day sales
Retail Inventory Method
Selling Price Formula
Early Markdowns
Temporary Price Reduction
39. Merchandise Available for sale at cost/ Merchandise available for sale at retail
LIFO (last in - first out)
Planned Initial Markup % Formula
Cost Complement Formula
Markdown Percentage Formula
40. Revenues received by a retailer
Off-Price Markdowns
Acid Test or Quick Ratio (QR) Formula
Net Sales
Expense Ratio Formula
41. Cost + Markup
Current Liabilities
Selling Price Formula
Operating Expenses
Assets Formula
42. Sales for the period/ average inventory
Turnover Rate Formula
Late Markdowns
Liabilities
Cumulative Markup
43. 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.
Inventory
Promotional Markdown
Markdown Percentage Formula
Return on Net Worth
44. First price or Manufacturers suggestet Retal Price (MSRP)
Original Price
Retail Inventory Method
Assets Formula
New Price
45. All of the capital used in operating the store - whether provided by the owners or creditors (vendors - banks)
Accounts Receivable (AR)
Late Markdowns
Profit Margin Analysis Formula
Return on Assets
46. 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
Cumulative Markup
Promotional Markdown
Return on Assets
Price Sensitivity
47. Also referred to as the income or operating statement. 5 Basic Elements: Net Sales - Cost of Goods sold - Gross Margin - Operating Expenses - Net profit
Inventory
Profit Margin Analysis Formula
Sell-Through Rate
Profit and Loss Statement (P&L Statement)
48. Dollar markup ($)/ cost price ($)
Clearance Markdowns
Operating Expenses
Markup % of Cost Formula
Current Assets
49. The number of items remaining in stock x dollar markdown
Balance Sheet
Promotion Errors
Markdown Cancellation ($) Formula
Clearance Markdowns
50. Cannot be readily converted to cash within one year. (Fixtures - equipment - land/buildings)
Assets
Current Ratio (CR) Formula
Fixed Assets
Profit Margin Analysis Formula