Question 1

When forecasting sales, a common approach is to develop a national income forecast, then an industry sales forecast, and finally specific company and product forecasts.

Accepted Answer

A) True 
 B)False

Question 2

Stockturn rate equals:

Accepted Answer

A)  cost of sales divided by average inventory at cost. 
B)  net sales divided by an average inventory at selling price. 
C)  sales in units divided by average inventory in units. 
D)  All of these alternatives are correct. 
A)  cost of sales divided by average inventory at cost. 
B)  net sales divided by an average inventory at selling price. 
C)  sales in units divided by average inventory in units. 
D)  All of these alternatives are correct.

Question 3

An auto manufacturer that bases its sales forecast on increases in population and income is using the "factor method."

Accepted Answer

A) True 
 B)False

Question 4

Market potential refers to what a whole market segment might buy.

Accepted Answer

A) True 
 B)False

Question 5

A company's gross margin must cover all the costs of making and selling the products, and hopefully leave a reasonable net profit.

Accepted Answer

A) True 
 B)False

Question 6

A hardware retailer who seeks a markup of 50 percent recently bought a new item for $15.00. To determine its selling price, he/she should add ______________ to this cost.

Accepted Answer

A)  $40.00 
B)  $80.00 
C)  $10.00 
D)  $20.00 
E)  $15.00 
A)  $40.00 
B)  $80.00 
C)  $10.00 
D)  $20.00 
E)  $15.00

Question 7

The Sales and Marketing Management "Buying Power Index" is a measure of the potential in different geographic areas.

Accepted Answer

A) True 
 B)False

Question 8

A marketing researcher estimates that during the next year a market's total purchases of a new product will be $250,000. One firm expects to sell $110,000 worth. It knows that its profits will be about 10 percent of its sales. This firm's sales forecast is:

Accepted Answer

A)  $90,000 
B)  $250,000 
C)  $110,000 
D)  $11,000 
E)  There is not enough information to tell. 
A)  $90,000 
B)  $250,000 
C)  $110,000 
D)  $11,000 
E)  There is not enough information to tell.

Question 9

Markups (expressed as a percentage of selling price) cannot be converted to markup percents expressed as a percentage of cost without knowing the actual selling price or the actual cost.

Accepted Answer

A) True 
 B)False

Question 10

Returns or allowances are subtracted from net sales to find gross sales on an operating statement.

Accepted Answer

A) True 
 B)False

Question 11

The ROI ratio might be improved by earning at least the same net profit while reducing investment.

Accepted Answer

A) True 
 B)False

Question 12

A 33 1/3 percent markup on selling price equals a 50 percent markup on cost.

Accepted Answer

A) True 
 B)False

Question 13

SALES AND MARKETING MANAGEMENT'S "Buying Power Index" (BPI) reflects each geographic market's share of total U.S.:

Accepted Answer

A)  population. 
B)  income. 
C)  retail sales. 
D)  All of these alternatives are correct. 
A)  population. 
B)  income. 
C)  retail sales. 
D)  All of these alternatives are correct.

Question 14

Gross margin (or gross profit) is the amount left over after the cost of sales is subtracted from gross sales.

Accepted Answer

A) True 
 B)False

Question 15

"Market potential" is:

Accepted Answer

A)  what a whole market segment might buy. 
B)  how much a firm hopes to sell to a market segment. 
C)  how much an industry hopes to sell to a market segment. 
D)  an estimate of the national income for the coming year. 
E)  None of these alternatives is correct. 
A)  what a whole market segment might buy. 
B)  how much a firm hopes to sell to a market segment. 
C)  how much an industry hopes to sell to a market segment. 
D)  an estimate of the national income for the coming year. 
E)  None of these alternatives is correct.

Question 16

If a wholesaler takes a 33.3 percent markup on selling price, what is the approximate markup on cost?

Accepted Answer

A)  80% 
B)  50% 
C)  20% 
D)  100% 
E)  33% 
A)  80% 
B)  50% 
C)  20% 
D)  100% 
E)  33%

Question 17

When calculating operating ratios from an operating statement, the denominator is usually net profit.

Accepted Answer

A) True 
 B)False

Question 18

Sales forecasts based on Sales and Marketing Management's "Buying Power Index" assume that sales are related to a market's population, income, and retail sales.

Accepted Answer

A) True 
 B)False

Question 19

An operating statement is a simple summary of a company's assets, liabilities, and owners' equity at a particular time.

Accepted Answer

A) True 
 B)False

Question 20

Use the information below to answer the following questions that refer to Table B-1. Based on the information in Table B-1, and given that the stockturn rate is 10, the cost of sales is:
$$\begin{array} { l c } 
 { \text { Table B-1 } } \
\text { Gross sales } & \$ 650,000 \
\text { Returns } & \$ 40,000 \
\text { Allowances } & \$ 10,000 \
\text { Markdowns } & \$ 20,000 \
\text { Beginning inventory } & \$ 50,000 \
\text { Ending inventory } & \$ 30,000 \
\text { Expenses } & 25 \% \
\text { Stockturn rate } & 10 \
\text { Investment } & \$ 250,000
\end{array}$$

Accepted Answer

A)  $400,000. 
B)  $70,000. 
C)  $60,000. 
D)  $65,000. 
A)  $400,000. 
B)  $70,000. 
C)  $60,000. 
D)  $65,000.

When forecasting sales, a common approach is to develop a national income forecast, then an industry sales forecast, and finally specific company and product forecasts.

Stockturn rate equals:

An auto manufacturer that bases its sales forecast on increases in population and income is using the "factor method."

Market potential refers to what a whole market segment might buy.

A company's gross margin must cover all the costs of making and selling the products, and hopefully leave a reasonable net profit.

A hardware retailer who seeks a markup of 50 percent recently bought a new item for $15.00. To determine its selling price, he/she should add ______________ to this cost.

The Sales and Marketing Management "Buying Power Index" is a measure of the potential in different geographic areas.

A marketing researcher estimates that during the next year a market's total purchases of a new product will be $250,000. One firm expects to sell $110,000 worth. It knows that its profits will be about 10 percent of its sales. This firm's sales forecast is:

Markups (expressed as a percentage of selling price) cannot be converted to markup percents expressed as a percentage of cost without knowing the actual selling price or the actual cost.

Returns or allowances are subtracted from net sales to find gross sales on an operating statement.

The ROI ratio might be improved by earning at least the same net profit while reducing investment.

A 33 1/3 percent markup on selling price equals a 50 percent markup on cost.

SALES AND MARKETING MANAGEMENT'S "Buying Power Index" (BPI) reflects each geographic market's share of total U.S.:

Gross margin (or gross profit) is the amount left over after the cost of sales is subtracted from gross sales.

"Market potential" is:

If a wholesaler takes a 33.3 percent markup on selling price, what is the approximate markup on cost?

When calculating operating ratios from an operating statement, the denominator is usually net profit.

Sales forecasts based on Sales and Marketing Management's "Buying Power Index" assume that sales are related to a market's population, income, and retail sales.

An operating statement is a simple summary of a company's assets, liabilities, and owners' equity at a particular time.

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

When forecasting sales, a common approach is to develop a national income forecast, then an industry sales forecast, and finally specific company and product forecasts.

Stockturn rate equals:

An auto manufacturer that bases its sales forecast on increases in population and income is using the "factor method."

Market potential refers to what a whole market segment might buy.

A company's gross margin must cover all the costs of making and selling the products, and hopefully leave a reasonable net profit.

A hardware retailer who seeks a markup of 50 percent recently bought a new item for $15.00. To determine its selling price, he/she should add ______________ to this cost.

The Sales and Marketing Management "Buying Power Index" is a measure of the potential in different geographic areas.

A marketing researcher estimates that during the next year a market's total purchases of a new product will be $250,000. One firm expects to sell $110,000 worth. It knows that its profits will be about 10 percent of its sales. This firm's sales forecast is:

Markups (expressed as a percentage of selling price) cannot be converted to markup percents expressed as a percentage of cost without knowing the actual selling price or the actual cost.

Returns or allowances are subtracted from net sales to find gross sales on an operating statement.

The ROI ratio might be improved by earning at least the same net profit while reducing investment.

A 33 1/3 percent markup on selling price equals a 50 percent markup on cost.

SALES AND MARKETING MANAGEMENT'S "Buying Power Index" (BPI) reflects each geographic market's share of total U.S.:

Gross margin (or gross profit) is the amount left over after the cost of sales is subtracted from gross sales.

"Market potential" is:

If a wholesaler takes a 33.3 percent markup on selling price, what is the approximate markup on cost?

When calculating operating ratios from an operating statement, the denominator is usually net profit.

Sales forecasts based on Sales and Marketing Management's "Buying Power Index" assume that sales are related to a market's population, income, and retail sales.

An operating statement is a simple summary of a company's assets, liabilities, and owners' equity at a particular time.

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