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. The number of items remaining in stock x dollar markdown






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






3. 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.






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






5. Liabilities+ Owner's equity or net worth






6. 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






7. 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.






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






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






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






11. Financial debts incurred by a retailer






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






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






14. Price is changed (up or down)






15. Total Assets/ Net Worth






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






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






18. Net Profit/ Net Sales






19. (Cash + Accounts Receivable) / Current Liabilities






20. Price Lining - price zones - price ranges






21. Sales less cost of goods sold






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






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






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






25. One that is just enough to move the goods






26. Net Profit After Taxes/ Net Worth






27. Net dollar markdown/ net dollar selling price






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






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






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






31. 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






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






33. Short time - like 1 or 2 day sales






34. 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






35. 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.






36. Merchandise Available for sale at cost/ Merchandise available for sale at retail






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






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






39. Costs involved in running the business






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






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






42. Cost + Markup






43. (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%






44. Total Expenses/ Net Sales






45. Can be transformed simply and rapidly into cash






46. Current Assets/ Current Liabilities






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






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






49. 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






50. 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.