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. One that is just enough to move the goods






3. Price is changed (up or down)






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






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.






6. (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%






7. 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






8. 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






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






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






11. Can be transformed simply and rapidly into cash






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






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






14. 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






15. 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






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






17. Costs involved in running the business






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






19. Original Retail price- markdown selling price






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






21. Net Profit/ Net Sales






22. Liabilities+ Owner's equity or net worth






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






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






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






26. 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.






27. In the Cost Method. Merchandise most recently purchased is assumed to have been sold first. Therefore - the ending inventory reflects the items in stock for the longest period of time. Produces lowest ending inventory value and highest cost of goods






28. Evaluates the managament of capital






29. The difference between the total delivered cost and the total retail price of merchandise handled during a given period.






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






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






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






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






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






35. Cost + Markup






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






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






38. 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






39. 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.






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






41. Current Liabilites/ Net Worth






42. 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.






43. 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






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






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






47. Current Assets/ Current Liabilities






48. Total Expenses/ Net Sales






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. Financial debts incurred by a retailer