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






2. Price is changed (up or down)






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






4. Total Expenses/ Net Sales






5. Evaluates the managament of capital






6. Current Assets/ Current Liabilities






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






8. Net Profit After Taxes/ Total Assets






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






10. 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






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






12. Current Liabilites/ Net Worth






13. 1. Determine merchandise available for sale at both cost and retail prices. 2.Calculate the cost to retail complement or percentage relationship of the cost of merchandise to the selling price. 3. Subtract markdowns taken during the period. 4. Determ






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






15. 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.






16. 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






17. 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






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






19. (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%






20. 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.






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






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






23. 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.






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






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






26. (Cash + Accounts Receivable) / Current Liabilities






27. In Cost Method. Merchandise sold during a time period is assumed to be sold in the order the merchandise was received. Merchandise on hand for the longest period of time is sold first. Therefore - the ending inventory reflects the items in stock for






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






29. Net Profit After Taxes/ Net Worth






30. Liabilities+ Owner's equity or net worth






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






32. Net dollar markdown/ net dollar selling price






33. 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






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






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






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






37. 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.






38. 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






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






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






41. Financial debts incurred by a retailer






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






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






44. 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.






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






46. 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






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






48. Based on a calculation commonly represented as a percentage - comparing the amount of inventory a retailer receives from a manufacturer or supplier against what is actually sold to the consumer






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






50. Revenues received by a retailer