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






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






3. Costs involved in running the business






4. 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






5. 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






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






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






8. Current Assets/ Current Liabilities






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






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






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






12. 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






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






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






15. 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






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






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






18. Total Expenses/ Net Sales






19. Sales less cost of goods sold






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






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






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






23. Can be transformed simply and rapidly into cash






24. Sales for the period/ average inventory






25. 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.






26. 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






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






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






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






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






31. Price Lining - price zones - price ranges






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






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






35. (Cash + Accounts Receivable) / Current Liabilities






36. Evaluates the managament of capital






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






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






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






40. 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






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






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






43. Net Profit/ Net Sales






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






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






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






47. What the retailer owns in monetary value






48. One that is just enough to move the goods






49. 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






50. 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