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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. Financial debts incurred by a retailer






2. 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






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






4. Can be transformed simply and rapidly into cash






5. Sales less cost of goods sold






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






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






8. 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






9. Sales for the period/ average inventory






10. Net dollar markdown/ net dollar selling price






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






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






13. Current Assets/ Current Liabilities






14. Revenues received by a retailer






15. 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.






16. 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






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






18. (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%






19. Evaluates the managament of capital






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






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






22. 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.






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. 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.






25. Original Retail price- markdown selling price






26. 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






27. Short time - like 1 or 2 day sales






28. 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






29. What the retailer owns in monetary value






30. Liabilities+ Owner's equity or net worth






31. One that is just enough to move the goods






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






33. Net Profit After Taxes/ Total Assets






34. Net Profit/ Net Sales






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






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






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






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






39. 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






40. Cost + Markup






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






42. Current Liabilites/ Net Worth






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






44. 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






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






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






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. Price Lining - price zones - price ranges






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






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






Can you answer 50 questions in 15 minutes?



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