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. Net Profit After Taxes/ Net Worth






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






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






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






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. Revenues received by a retailer






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






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






9. 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






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






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






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






13. Price is changed (up or down)






14. Short time - like 1 or 2 day sales






15. 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






16. Buying errors - promotion errors - pricing errors - uncontrollable errors






17. Sales less cost of goods sold






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






19. 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






20. Current Assets/ Current Liabilities






21. (Cash + Accounts Receivable) / Current Liabilities






22. 1. Determine merchandise available for sale at both cost and retail prices. 2.Calculate the cost to retail complement or percentage relationship of the cost of merchandise to the selling price. 3. Subtract markdowns taken during the period. 4. Determ






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






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






25. 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.






26. (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%






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






28. 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.






29. Liabilities+ Owner's equity or net worth






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






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






32. 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






33. 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






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






35. Cost + Markup






36. 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






37. Sales for the period/ average inventory






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






39. Price Lining - price zones - price ranges






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






41. Financial debts incurred by a retailer






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






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






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






45. 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






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






47. Current Liabilites/ Net Worth






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






49. 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






50. What the retailer owns in monetary value