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 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.






2. Price Lining - price zones - price ranges






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






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






5. One that is just enough to move the goods






6. Revenues received by a retailer






7. Net Profit After Taxes/ Net Worth






8. Liabilities+ Owner's equity or net worth






9. The weather - merchandise is shopworn - economic downturn






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






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






12. Short time - like 1 or 2 day sales






13. Cost + Markup






14. 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.






15. 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.






16. Costs involved in running the business






17. Buying errors - promotion errors - pricing errors - uncontrollable errors






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






19. 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






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






21. What the retailer owns in monetary value






22. Sales for the period/ average inventory






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






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






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






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






27. Evaluates the managament of capital






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






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






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






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






32. 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






33. Net dollar markdown/ net dollar selling price






34. 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






35. Net Profit/ Net Sales






36. Total Assets/ Net Worth






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






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






39. Current Assets/ Current Liabilities






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






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






42. 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






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






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






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






46. Net Profit After Taxes/ Total Assets






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






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






49. Financial debts incurred by a retailer






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