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






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






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






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






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






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






7. 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






8. (Cash + Accounts Receivable) / Current Liabilities






9. What the retailer owns in monetary value






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






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






12. 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.






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






14. 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






15. 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






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






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






18. 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






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






20. Revenues received by a retailer






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






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






23. 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






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






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






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






27. The extent to which a retailer is using debt or borrowed funds to operate the business. (The higher the FLR the higher the debt)






28. Net Profit After Taxes/ Total Assets






29. Short time - like 1 or 2 day sales






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






31. Current Assets/ Current Liabilities






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






33. 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






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






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






36. Original Retail price- markdown selling price






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






38. Sales less cost of goods sold






39. Price Lining - price zones - price ranges






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






41. 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.






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






43. Price is changed (up or down)






44. Total Assets/ Net Worth






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






46. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






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






49. Liabilities+ Owner's equity or net worth






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