Question 1

The net cost of delivered purchases equals the original invoice cost of purchases plus purchase discounts minus freight charges.

Accepted Answer

A) True 
 B)False

Question 2

If net sales on the operating statement for Brandywine Company were $200,000--and gross sales were $240,000--what would the cost of sales be if the gross margin was 20 percent?

Accepted Answer

A)  $140,000 
B)  $168,000 
C)  $160,000 
D)  $120,000 
E)  Cannot be determined without knowing Brandywine's expenses and net profit. 
A)  $140,000 
B)  $168,000 
C)  $160,000 
D)  $120,000 
E)  Cannot be determined without knowing Brandywine's expenses and net profit.

Question 3

Ms. Treadway's athletic shoe store had gross sales of $62,500 in January. Compute her NET SALES for the month from the following data. $$\begin{array} { l c } 
\text { Sales returns } & \$ 2,500 \
\text { Purchases } & \$ 5,000 \
\text { Markdowns } & \$ 2,000 \
\text { Stockturn rate } & 3
\end{array}$$

Accepted Answer

A)  $59,500 
B)  $5,500 
C)  $48,000 
D)  $60,000 
E)  $3,500 
A)  $59,500 
B)  $5,500 
C)  $48,000 
D)  $60,000 
E)  $3,500

Question 4

Use the information below to answer the following questions that refer to Table B-2. Based on the information in Table B-2, the stockturn rate is:
$$\begin{array} { l c } 
 { \text { Table B-2 } } & \
\text { Gross sales } & \$ 240,000 \
\text { Returns } & \$ 20,000 \
\text { Allowances } & \$ 20,000 \
\text { Gross margin } & 25 \% \
\text { Beginning inventory } & \$ 50,000 \
\text { Ending inventory } & \$ 50,000 \
\text { Expenses } & \$ 40,000 \
\text { Markdowns } & \$ 30,000 \
\text { Investment } & \$ 50,000
\end{array}$$

Accepted Answer

A)  4. 
B)  5. 
C)  3. 
D)  1. 
E)  2. 
A)  4. 
B)  5. 
C)  3. 
D)  1. 
E)  2.

Question 5

A retailer has estimated that her store has a market potential of about $3 million for the coming year. From this information, we know that:

Accepted Answer

A)  the owner has not yet planned her marketing strategy for the coming year. 
B)  the store will sell about $3 million of goods and services during the coming year. 
C)  the store's sales forecast is probably LESS than $3 million. 
D)  if the store maintains its present 20 percent market share, its competitors' sales should total about $15 million. 
E)  Both B and C are true. 
A)  the owner has not yet planned her marketing strategy for the coming year. 
B)  the store will sell about $3 million of goods and services during the coming year. 
C)  the store's sales forecast is probably LESS than $3 million. 
D)  if the store maintains its present 20 percent market share, its competitors' sales should total about $15 million. 
E)  Both B and C are true.

Question 6

Return on investment is a measure of the dollar resources the firm has invested in a project or business.

Accepted Answer

A) True 
 B)False

Question 7

A sales forecast is an estimate of how much an industry or firm hopes to sell to a market segment.

Accepted Answer

A) True 
 B)False

Question 8

The accuracy of any sales forecast depends on whether the firm selects and implements a marketing mix that turns these opportunities into sales and profits.

Accepted Answer

A) True 
 B)False

Question 9

Net sales and net profit are the same thing.

Accepted Answer

A) True 
 B)False

Question 10

Regarding sales forecasting:

Accepted Answer

A)  marketing managers usually develop their own national income and industry forecasts. 
B)  trend extension cannot be used when past sales have varied. 
C)  the final step should be to develop an industry sales forecast. 
D)  trend extension assumes that past conditions will continue unchanged into the future. 
E)  only one forecasting method should be used because different techniques give different forecasts. 
A)  marketing managers usually develop their own national income and industry forecasts. 
B)  trend extension cannot be used when past sales have varied. 
C)  the final step should be to develop an industry sales forecast. 
D)  trend extension assumes that past conditions will continue unchanged into the future. 
E)  only one forecasting method should be used because different techniques give different forecasts.

Question 11

A farm supply store starting with a $40,000 inventory at cost expects to sell $400,000 (cost of sales) of merchandise in the coming year. It plans to turn over its stock 10 times during the year. How much merchandise must the shop purchase during the year?

Accepted Answer

A)  $200,000 
B)  $400,000 
C)  $420,000 
D)  $440,000 
E)  None of these alternatives is correct. 
A)  $200,000 
B)  $400,000 
C)  $420,000 
D)  $440,000 
E)  None of these alternatives is correct.

Question 12

Markdowns:

Accepted Answer

A)  do not affect the profits of a business. 
B)  are not shown on an operating statement. 
C)  are similar to allowances--and are subtracted from gross sales on an operating statement. 
D)  are generally caused by "consumer errors." 
E)  All of these alternatives are correct. 
A)  do not affect the profits of a business. 
B)  are not shown on an operating statement. 
C)  are similar to allowances--and are subtracted from gross sales on an operating statement. 
D)  are generally caused by "consumer errors." 
E)  All of these alternatives are correct.

Question 13

Which of the following statements about operating ratios (which can be calculated from operating statements) is TRUE?

Accepted Answer

A)  By comparing operating ratios from one period to another, a firm can identify areas that may need special attention. 
B)  These ratios are often used for control purposes. 
C)  These ratios are calculated by dividing operating statement items by net sales. 
D)  By comparing its operating ratios with competitors' ratios, a firm may be able to obtain a better idea of how it is doing. 
E)  All of these statements about operating ratios are TRUE. 
A)  By comparing operating ratios from one period to another, a firm can identify areas that may need special attention. 
B)  These ratios are often used for control purposes. 
C)  These ratios are calculated by dividing operating statement items by net sales. 
D)  By comparing its operating ratios with competitors' ratios, a firm may be able to obtain a better idea of how it is doing. 
E)  All of these statements about operating ratios are TRUE.

Question 14

The "jury-of-executive-opinion" sales forecasting approach has an advantage in that:

Accepted Answer

A)  executives usually have excellent knowledge about all the outside market forces that may impact demand. 
B)  no other quantitative estimates are necessary. 
C)  a forecast can be obtained quickly and easily. 
D)  past trends are usually ignored. 
E)  trend extension is minimized. 
A)  executives usually have excellent knowledge about all the outside market forces that may impact demand. 
B)  no other quantitative estimates are necessary. 
C)  a forecast can be obtained quickly and easily. 
D)  past trends are usually ignored. 
E)  trend extension is minimized.

Question 15

The main advantage of the jury approach is that it can be done quickly and easily.

Accepted Answer

A) True 
 B)False

Question 16

A ___________ is a variable that shows the relation of some other variable to the item being forecast.

Accepted Answer

A)  constant 
B)  adjustable 
C)  factor 
D)  negotiable 
E)  subset 
A)  constant 
B)  adjustable 
C)  factor 
D)  negotiable 
E)  subset

Question 17

Given the following information, calculate the firm's COST OF SALES. $$\begin{array} { l l } 
\text { Beginning inventory } & \$ 50,000 \
\text { Purchase discounts } & \$ 10,000 \
\text { Ending inventory } & \$ 60,000 \
\text { Purchases } & \$ 200,000 \
\text { Freight-in } & \$ 10,000
\end{array}$$

Accepted Answer

A)  $180,000 
B)  $285,000 
C)  $190,000 
D)  $120,000 
E)  Cannot be determined without knowing the firm's net sales. 
A)  $180,000 
B)  $285,000 
C)  $190,000 
D)  $120,000 
E)  Cannot be determined without knowing the firm's net sales.

Question 18

The "jury-of-executive-opinion" approach to sales forecasting combines the opinions of experienced executives from:

Accepted Answer

A)  sales. 
B)  purchasing. 
C)  marketing. 
D)  finance. 
E)  any or all of these. 
A)  sales. 
B)  purchasing. 
C)  marketing. 
D)  finance. 
E)  any or all of these.

Question 19

The three main components of an operating statement are costs, assets, and profit.

Accepted Answer

A) True 
 B)False

Question 20

Which of these are most likely to be familiar with customer reactions and what competitors are doing?

Accepted Answer

A)  A jury of executives 
B)  Salespeople 
C)  Corporate office managers 
D)  Purchasing managers 
E)  None of these is a good answer. 
A)  A jury of executives 
B)  Salespeople 
C)  Corporate office managers 
D)  Purchasing managers 
E)  None of these is a good answer.

The net cost of delivered purchases equals the original invoice cost of purchases plus purchase discounts minus freight charges.

If net sales on the operating statement for Brandywine Company were $200,000--and gross sales were $240,000--what would the cost of sales be if the gross margin was 20 percent?

Ms. Treadway's athletic shoe store had gross sales of $62,500 in January. Compute her NET SALES for the month from the following data. Sales returns \ 2,500 Purchases \ 5,000 Markdowns \ 2,000 Stockturn rate 3

A retailer has estimated that her store has a market potential of about $3 million for the coming year. From this information, we know that:

Return on investment is a measure of the dollar resources the firm has invested in a project or business.

A sales forecast is an estimate of how much an industry or firm hopes to sell to a market segment.

The accuracy of any sales forecast depends on whether the firm selects and implements a marketing mix that turns these opportunities into sales and profits.

Net sales and net profit are the same thing.

Regarding sales forecasting:

A farm supply store starting with a $40,000 inventory at cost expects to sell $400,000 (cost of sales) of merchandise in the coming year. It plans to turn over its stock 10 times during the year. How much merchandise must the shop purchase during the year?

Markdowns:

Which of the following statements about operating ratios (which can be calculated from operating statements) is TRUE?

The "jury-of-executive-opinion" sales forecasting approach has an advantage in that:

The main advantage of the jury approach is that it can be done quickly and easily.

A ___________ is a variable that shows the relation of some other variable to the item being forecast.

Given the following information, calculate the firm's COST OF SALES. Beginning inventory \ 50,000 Purchase discounts \ 10,000 Ending inventory \ 60,000 Purchases \ 200,000 Freight-in \ 10,000

The "jury-of-executive-opinion" approach to sales forecasting combines the opinions of experienced executives from:

The three main components of an operating statement are costs, assets, and profit.

Which of these are most likely to be familiar with customer reactions and what competitors are doing?

Marketing39s Value to Consumers, Firms, and Society

Marketing Strategy Planning

Evaluating Opportunities in the Changing Marketing Environment

Focusing Marketing Strategy With Segmentation and Positioning

Final Consumers and Their Buying Behavior

Business and Organizational Customers and Their Buying Behavior

Improving Decisions With Marketing Information

Elements of Product Planning for Goods and Services

Product Management and New-Product Development

Place and Development of Channel Systems

Distribution Customer Service and Logistics

Retailers, Wholesalers, and Their Strategy Planning

Promotion - Introduction to Integrated Marketing Communications

Personal Selling and Customer Service

Advertising, Publicity, and Sales Promotion

Pricing Objectives and Policies

Price Setting in the Business World

Ethical Marketing in a Consumer-Oriented World: Appraisal and Challenges

Economics Fundamentals

Filters

Exam 20: Marketing Arithmetic

The net cost of delivered purchases equals the original invoice cost of purchases plus purchase discounts minus freight charges.

If net sales on the operating statement for Brandywine Company were $200,000--and gross sales were $240,000--what would the cost of sales be if the gross margin was 20 percent?

Ms. Treadway's athletic shoe store had gross sales of $62,500 in January. Compute her NET SALES for the month from the following data. Sales returns \ 2,500 Purchases \ 5,000 Markdowns \ 2,000 Stockturn rate 3

A retailer has estimated that her store has a market potential of about $3 million for the coming year. From this information, we know that:

Return on investment is a measure of the dollar resources the firm has invested in a project or business.

A sales forecast is an estimate of how much an industry or firm hopes to sell to a market segment.

The accuracy of any sales forecast depends on whether the firm selects and implements a marketing mix that turns these opportunities into sales and profits.

Net sales and net profit are the same thing.

Regarding sales forecasting:

A farm supply store starting with a $40,000 inventory at cost expects to sell $400,000 (cost of sales) of merchandise in the coming year. It plans to turn over its stock 10 times during the year. How much merchandise must the shop purchase during the year?

Markdowns:

Which of the following statements about operating ratios (which can be calculated from operating statements) is TRUE?

The "jury-of-executive-opinion" sales forecasting approach has an advantage in that:

The main advantage of the jury approach is that it can be done quickly and easily.

A ___________ is a variable that shows the relation of some other variable to the item being forecast.

Given the following information, calculate the firm's COST OF SALES. Beginning inventory \ 50,000 Purchase discounts \ 10,000 Ending inventory \ 60,000 Purchases \ 200,000 Freight-in \ 10,000

The "jury-of-executive-opinion" approach to sales forecasting combines the opinions of experienced executives from:

The three main components of an operating statement are costs, assets, and profit.

Which of these are most likely to be familiar with customer reactions and what competitors are doing?

Marketing39s Value to Consumers, Firms, and Society

Marketing Strategy Planning

Evaluating Opportunities in the Changing Marketing Environment

Focusing Marketing Strategy With Segmentation and Positioning

Final Consumers and Their Buying Behavior

Business and Organizational Customers and Their Buying Behavior

Improving Decisions With Marketing Information

Elements of Product Planning for Goods and Services

Product Management and New-Product Development

Place and Development of Channel Systems

Distribution Customer Service and Logistics

Retailers, Wholesalers, and Their Strategy Planning

Promotion - Introduction to Integrated Marketing Communications

Personal Selling and Customer Service

Advertising, Publicity, and Sales Promotion

Pricing Objectives and Policies

Price Setting in the Business World

Ethical Marketing in a Consumer-Oriented World: Appraisal and Challenges

Economics Fundamentals

Filters