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






2. What the retailer owns in monetary value






3. Revenues received by a retailer






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






5. Can be transformed simply and rapidly into cash






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






7. 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






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






9. 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






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






11. Current Liabilites/ Net Worth






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






13. 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.






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






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. Total Assets/ Net Worth






17. The awareness of the consumer to what they perceive to be the window of cost within which they will buy a particular product or service






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






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






20. Short time - like 1 or 2 day sales






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






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






23. Buying errors - promotion errors - pricing errors - uncontrollable errors






24. Price is changed (up or down)






25. (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%






26. 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.






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






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






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






30. 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






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






32. 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






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






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






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






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






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






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






39. Net Profit/ Net Sales






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






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






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






43. Costs involved in running the business






44. 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.






45. 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






46. Financial debts incurred by a retailer






47. Liabilities+ Owner's equity or net worth






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






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






50. Net Profit After Taxes/ Net Worth