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 weather - merchandise is shopworn - economic downturn






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






3. Can be transformed simply and rapidly into cash






4. Net Profit After Taxes/ Net Worth






5. Price is changed (up or down)






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






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






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






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






10. Revenues received by a retailer






11. 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






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






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






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






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






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






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






18. Assets collected within one year. Due to the widespread use of credit cards - AR for retailers has diminished with exceptions such as lay-a-way.






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






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






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






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






23. Financial debts incurred by a retailer






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






25. 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.






26. Evaluates the managament of capital






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






28. Net Profit/ Net Sales






29. What the retailer owns in monetary value






30. Net Profit After Taxes/ Total Assets






31. 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






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






33. 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






34. Liabilities+ Owner's equity or net worth






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






36. 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






37. 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






38. Price Lining - price zones - price ranges






39. (Cash + Accounts Receivable) / Current Liabilities






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






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






42. Original Retail price- markdown selling price






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






44. Current Assets/ Current Liabilities






45. 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






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






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






48. Total Assets/ Net Worth






49. One that is just enough to move the goods






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