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. 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






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






3. 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.






4. Price is changed (up or down)






5. Liabilities+ Owner's equity or net worth






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






7. Financial debts incurred by a retailer






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






9. Can be transformed simply and rapidly into cash






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






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






12. Cost + Markup






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






14. 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






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






16. Short time - like 1 or 2 day sales






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






18. Net Profit/ Net Sales






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






20. Evaluates the managament of capital






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






22. 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.






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






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






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






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






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






28. The weather - merchandise is shopworn - economic downturn






29. Current Assets/ Current Liabilities






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






31. Price Lining - price zones - price ranges






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






33. What the retailer owns in monetary value






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






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






36. Net Profit After Taxes/ Total Assets






37. Total Expenses/ Net Sales






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






39. Net dollar markdown/ net dollar selling price






40. Current Liabilites/ Net Worth






41. 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.






42. 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






43. (Cash + Accounts Receivable) / Current Liabilities






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






45. 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.






46. 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






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






48. 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.






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






50. Dollar Markdown of Merchandise/ original retail selling price of merchandise being marked down