MAT 114 Exam 3 Questions And Answers (Verified And Updated)

MAT 114 Exam 3 Questions And Answers (Verified And Updated) Merchandising (8) - answerThe planning and controlling of buying and selling of goods and services Merchandise budget (8) - answerA PLAN of projected sales (for the upcoming season) Includes when and how much merchandise is purchased and markups/reductions Five major questions in merchandising budget (8) - answer1) anticipated sales? 2) stock on hand to achieve sales plan? 3) What reductions must be made? 4) What additional purchases must be made? 5) What should the gross margin be? (sales - cost of goods sold) Four rules for creating a merchandising budget (8) - answer1) always be prepared in advance of selling season (4 months) 2) language of budget must be easy to understand 3) plan for a short period is time (six months is the norm; if you plan too far ahead there is added risk) 4) flexible enough to permit changes * look at figure 8.1 and 8.2 in the book Determining planned sales (8) - answerestimate for entire season including monthly breakdown, examines previous years' sales takes into account holidays and weekends, weather forecasts, and inflation Determining planned inventory (8) - answerStock to sales ratio: how much inventory you need to have; a certain amount of stock is needed to meet a goal. This can be based on the industry average or the retailer's inventory goals Determining planned retail reductions (8) - answerMarkdowns, employee discounts, stock shortages Determining planned purchases at retail and cost (8) - answerplanned sales, planned retail reductions, planned EOM inventory the last step is determining the gross margin Retail accounting statements - income statement (or profit and loss statement) (8) - answersummary of the sales and expenses for a GIVEN TIME most important monthly, quarterly, seasonally, or annually Retail accounting statements - balance sheet (8) - answerongoing, but looking at a PARTICULAR POINT IN TIME; used to observe changes in firms' financial conditions Assets (8) - answerassets = liabilities + net worth anything of value owned by a retail firm Figure 8.6 on pg. 327 (8) - answera balance sheet has assets and liabilities Current assets (8) - answercash or items that can be converted into cash (short period of time)