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. Revenues received by a retailer






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






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






5. Costs involved in running the business






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






7. One that is just enough to move the goods






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






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






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






11. Total Expenses/ Net Sales






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






13. 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.






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






15. 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






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






17. Evaluates the managament of capital






18. The weather - merchandise is shopworn - economic downturn






19. Sales for the period/ average inventory






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






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






22. Net dollar markdown/ net dollar selling price






23. Liabilities+ Owner's equity or net worth






24. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






26. (Cash + Accounts Receivable) / Current Liabilities






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






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






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






30. (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%






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






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






33. Price is changed (up or down)






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






35. 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.






36. Financial debts incurred by a retailer






37. Sales less cost of goods sold






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






39. 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






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






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






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






43. 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.






44. Price Lining - price zones - price ranges






45. Can be transformed simply and rapidly into cash






46. 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






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






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






49. 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






50. Net Profit/ Net Sales