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






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






3. Current Assets/ Current Liabilities






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






5. What the retailer owns in monetary value






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






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






8. Price is changed (up or down)






9. Sales for the period/ average inventory






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






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






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






13. 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






14. Net Profit/ Net Sales






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






16. (Cash + Accounts Receivable) / Current Liabilities






17. 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






18. 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.






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






20. 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.






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






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






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






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






25. Original Retail price- markdown selling price






26. Total Assets/ Net Worth






27. 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






28. The weather - merchandise is shopworn - economic downturn






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






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






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






32. 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.






33. 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






34. One that is just enough to move the goods






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






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






37. 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






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






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






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






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






42. Short time - like 1 or 2 day sales






43. Financial debts incurred by a retailer






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






45. Can be transformed simply and rapidly into cash






46. Net Profit After Taxes/ Net Worth






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






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






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






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