CRA CRA Retail Financial Analysis & Metrics 1

Question 1

How is gross margin percentage calculated?

Accepted Answer

(Revenue − COGS) / Revenue × 100

Answer

Gross margin percentage is gross profit (revenue minus cost of goods sold) divided by revenue, expressed as a percentage.

Question 2

What does 'sell-through rate' measure in retail inventory analysis?

Accepted Answer

Percentage of received inventory sold within a period

Answer

Sell-through rate measures the proportion of inventory received that was sold during a specific time period, indicating product demand.

Question 3

Which financial metric shows how many times a retailer sells and replaces its inventory in a year?

Accepted Answer

Inventory turnover ratio

Answer

Inventory turnover ratio equals COGS divided by average inventory and indicates how efficiently a retailer manages its stock.

Question 4

A store's same-store sales (SSS) increased 5% year-over-year. What does this indicate?

Accepted Answer

Existing store locations grew revenue by 5%

Answer

Same-store sales (also called comparable-store sales) measures revenue growth at locations open for at least one year, excluding new stores.

Question 5

What is 'shrink' in retail financial reporting?

Accepted Answer

Inventory loss due to theft, damage, or administrative error

Answer

Shrink refers to the difference between recorded inventory and actual physical inventory, caused by theft, damage, or errors.

(CRA) Certified Retail Analyst Practice Test