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






2. The weather - merchandise is shopworn - economic downturn






3. Net Profit After Taxes/ Total Assets






4. Indicates gross margin derived from the sales of merchandise and it's ability to cover operating expenses. Helps a retailer determine how much rent they should pay - what salary the owner should draw - and how much they should pay their associates.






5. 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






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






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






8. 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.






9. 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






10. Net Profit After Taxes/ Net Worth






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.






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






13. Evaluates the managament of capital






14. Short time - like 1 or 2 day sales






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






16. What the retailer owns in monetary value






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






18. Net Profit/ Net Sales






19. Price is changed (up or down)






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






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






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






23. One that is just enough to move the goods






24. (1) Response of consumers and (2) cost of receiving - handling - and placing merchandise for sale.






25. 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






26. 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






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






28. Can be transformed simply and rapidly into cash






29. 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.






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






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






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






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






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






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






36. 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






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






38. 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






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






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






41. Price Lining - price zones - price ranges






42. Sales less cost of goods sold






43. Current Liabilites/ Net Worth






44. 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.






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






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






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






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






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






50. Revenues received by a retailer