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






2. Cost + Markup






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






4. Price is changed (up or down)






5. Revenues received by a retailer






6. Total Expenses/ Net Sales






7. (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%






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






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






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






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






12. Sales for the period/ average inventory






13. Net dollar markdown/ net dollar selling price






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






15. 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






16. (Cash + Accounts Receivable) / Current Liabilities






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






19. What the retailer owns in monetary value






20. Cannot be readily converted to cash within one year. (Fixtures - equipment - land/buildings)






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






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






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






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






25. Current Liabilites/ Net Worth






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






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






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






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






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






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. 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.






33. 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.






34. Price Lining - price zones - price ranges






35. 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.






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. One that is just enough to move the goods






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






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






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






41. 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






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






43. 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






44. Net Profit After Taxes/ Net Worth






45. Current Assets/ Current Liabilities






46. Liabilities+ Owner's equity or net worth






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






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






49. 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.






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