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. 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






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






3. Costs involved in running the business






4. Current Liabilites/ Net Worth






5. The awareness of the consumer to what they perceive to be the window of cost within which they will buy a particular product or service






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






7. What the retailer owns in monetary value






8. Revenues received by a retailer






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






10. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






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






13. 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.






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






15. Original Retail price- markdown selling price






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






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






18. 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






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






20. Short time - like 1 or 2 day sales






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






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






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






24. Cost + Markup






25. Price is changed (up or down)






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






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. The retailers financial condition at a specific point in time






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






30. The weather - merchandise is shopworn - economic downturn






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






32. 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.






33. Price Lining - price zones - price ranges






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






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






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






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






38. 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.






39. 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






40. Financial debts incurred by a retailer






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






42. (Cash + Accounts Receivable) / Current Liabilities






43. Liabilities+ Owner's equity or net worth






44. Evaluates the managament of capital






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






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






47. One that is just enough to move the goods






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






49. 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






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