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






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






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






4. Current Assets/ Current Liabilities






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






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






7. Costs involved in running the business






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






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






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






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






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






13. Current Liabilites/ Net Worth






14. 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.






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. Short time - like 1 or 2 day sales






17. Total Assets/ Net Worth






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






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






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






22. Original Retail price- markdown selling price






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






24. Net Profit After Taxes/ Net Worth






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






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






27. 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.






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






29. Net Profit After Taxes/ Total Assets






30. 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






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






32. The higher the ratio the quicker current liabilities can be paid. This ratio also indicates the margin of safety a retailer has on hand to cover possible shrinkages






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






34. (Cash + Accounts Receivable) / Current Liabilities






35. One that is just enough to move the goods






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






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






38. The weather - merchandise is shopworn - economic downturn






39. Financial debts incurred by a retailer






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






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






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






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






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






45. Net dollar markdown/ net dollar selling price






46. What the retailer owns in monetary value






47. Buying errors - promotion errors - pricing errors - uncontrollable errors






48. (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%






49. 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.






50. Price Lining - price zones - price ranges