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GLOSSARY
COMPETENCY
5.00
Develop the skills necessary for selling fashion.
OBJECTIVE
5.03
Perform various mathematical calculations in retail
sales.
Cash sale: A transaction in which the customer pays for the purchase with cash or
check.
Change fund: Coins and currency designated for use in opening the register for a
given day’s activity.
Cost: The amount a retailer pays the supplier for an item for resale.
Denominator: The top number in a mathematical expression written as a fraction.
Employee discount: A set reduction in retail price given to an employee at the time of
a sales transaction.
Extension: The result of multiplying the number of units by the cost per unit.
Final selling price: The price at which merchandise ultimately sells after all markups
and/or markdowns are taken.
Gross profit: Sales revenue minus cost of merchandise sold.
Gross sales: Total revenue from sales before considering returns, allowances, or
adjustments.
Initial markup: The difference between merchandise cost and the selling price
originally placed on the merchandise.
Keystone markup: A markup that is equal to the cost of the merchandise.
Keystoning: Doubling the cost of the merchandise to arrive at the retail price.
Maintained markup: The difference between the total cost of the merchandise and its
final selling price.
Markdown: A strategy used to stimulate sales, dispose of slow moving/discontinued
merchandise, meet competitors’ prices, and increase customer traffic.
Markup: An amount added to the cost of goods to reach a selling price.
Net profit: Gross profit minus total operating expenses.
Fashion Merchandising
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Net sales: The revenue generated from sales minus sales returns and allowances.
Numerator: The bottom number in a mathematical expression written as a fraction.
Retail price: The sum of cost plus markup; the price the customer pays for the
merchandise.
Sales income: The revenue generated from sales minus sales returns and allowances.
Sales tax: A government fee, usually a percentage of the total sale, which is added to
the retail price of goods and paid by the final user.
Till: The cash drawer of a cash register.
Fashion Merchandising
E-64