Funeral Merchandising Unit 3 Study Guide Questions

Define merchandising.

The purchasing, pricing, display, and sale of merchandise.

Define the economic base of a community.

The wealth produced in or near a community that provides employment and income to the local population

Define a sales promotion.

a plan which provides inducements to potential purchases of products &/or services

The term for making the public aware of services or a commodity that a business has for sale.

advertising

The sum of a group of numbers divided by the number of units.

average (mean)

Define installment credit.

balance of costly goods paid for in small monthly (fractional) payments over a period of time, such as a mortgage or car loan

A method of price quotation showing separately the price for services to be rendered and the price for the merchandise is?

bi-unit pricing

the point at which total sales revenue equals total costs

break-even analysis

What does the credit term CBD mean?

cash before delivery

A reduction of the price given for payment of an account within the time limits established by the sales contract

cash discount

What does the credit term COD mean?

cash on delivery

What does the credit term CWO mean?

cash w/order

A device upon which two or three caskets are placed, one on top of the other for display.

casket rack

The stand or support upon which a casket rests in the selection process.

casket stand

A source of market data that explains where certain businesses are located.

census of business

A source of market data that keeps track of new home sales by region and/or the construction of new houses by region and specific area.

census of housing

A source of market data that explains where certain manufacturers are located.

census of manufactoring

A source of market data that compiles population statistics with regard to distribution of population by region, area, etc.

census of population

List some secondary sources market data.

chamber of commerce, census of business, census of housing, etc

another name for installment credit

closed-end credit

Placing caskets in the selection room in their order of increasing or decreasing value.

consecutive method

The merchandising agreement whereby merchandise is given to the funeral director to sell, but the funeral director does not have to pay for the merchandise that will be displayed until it is sold.

consignment

The percentage derived by dividing the wholesale cost of the merchandise by the retail price of the merchandise.

consumer value index (CVI)

What 2 buying motives influence most funeral home purchases?

convenience & economy (cost)

an agreement that payment for a product or service will be made at some later date

credit

The statistical study of human populations with respect to their size and density, distribution, composition, and income.

demographics

Three or four caskets utilized to educate the selecting party regarding the elements of casket construction.

demonstration group

Illumination directly shining on an object.

direct lighting

The method of selling caskets whereby the funeral director remains in the selection room throughout the selection process.

direct selection room procedure

the quantity to be purchased which minimizes total cost

economic order quantity (EOQ)

What does the credit term EOM mean?

end of month

What are the 4 steps to developing sales objectives?

evaluate the market, scrutinize sale history, consider merchandise criteria, & integrate into existing offerings

Which method of price determination is being used if the following amounts reflect the wholesale and retail price of 4 caskets? Casket Number Wholesale Retail 1 300 1300 2 1100 2100 3 650 1650 4 1000 2000

fixed dollar amount method

A cost that, for a given period of time and range of activity called the relevant range, does not change in total but becomes progressively smaller on a per unit basis as volume increases; these expenses do not increase with increased business, nor do they decrease with declining business activity.

fixed expense

When a funeral home marks up their caskets by a constant factor it is known as?

fixed multiple

Which method of price determination is being used if the following amounts reflect the wholesale and retail price of 4 caskets? Casket Number Wholesale Retail 1 300 750 2 1100 2750 3 650 1625 4 1000 2500

fixed multiple method

The illumination produced by a tubular electric discharge lamp; the fluorescence of phosphors coating the inside of a tube.

fluorescent lighting

use of portions of caskets (1/2, 1/4, or 1/8) in the selection room.

fractional display

A method of price quotation in which the charges are broken down into several major component parts such as professional services, facilities, automobiles and merchandise is?

functional pricing

A pricing method where the mark up varies is?

graduated recovery

Which method of price determination is being used if the following amounts reflect the wholesale and retail price of 4 caskets? Casket Number Wholesale Retail 1 300 600 2 1100 3850 3 650 1625 4 1000 3000

graduated recovery method

The illumination resulting from the glowing of a heated filament.

incandescent lighting

Reflected illumination of an object.

indirect lighting

The method of selling caskets whereby the funeral director does not stay in the selection room during the selection process.

indirect selection room procedure

those goods or stock which are held for resale

inventory

The number of times a selected unit has sold of a given time period is known as?

inventory turnover

the number of times the average inventory has been sold or used up during a period

inventory turnover

Why is advertising important to a funeral home?

it's making the public aware of services or a commodity that a business has for sale

The method of price quotation by which each unit of service or merchandise is priced separately is?

itemization

The inventory strategy in which products or inventory are delivered only at the time they are needed.

just in time (JIT)

The difference between merchandise cost and selling price

mark up

The difference between merchandise cost and selling price is?

mark up

reduction of selling price

markdown

A group of potential customers possessing purchasing power and unsatisfied needs.

market

The process of planning and executing the development, pricing, promotion, and distribution of an organization's goods or services.

marking management

`A value in an ordered set of values which represents the midpoint, whereby there are an equal number of values above and below the midpoint value.

median

The relationship between the wholesale cost of the merchandise and the total cost (both services and merchandise) to the consumer.

merchandise value ration (MVR)

What does the credit term MOM mean?

middle of month

The number that occurs most frequently in a listing of numbers.

mode

another name for revolving credit

open end credit

any cost not specifically associated with production of identifiable products and services

overhead

A pricing method where the funeral home groups together selected services or merchandise is known as?

package pricing

The method in which the funeral home establish the selling price for services and merchandise is?

price determination

The method by which the prices are explained to the consumer is?

price quotation

What are 5 of the factors in determining inventory to be offered?

product availability, price, quality, eye appeal, & supplier recommendations

What term describes the process of inducing the public to have a positive feeling about a particular business?

public relations

reduction in the amount of a bill when a minimum quantity of merchandise has been ordered

quantity discount

the upper and lower limits of a series of numbers

range

a return of a portion of a payment

rebate

What is the instructor's opinion of what merchandising included?

selling products & also educating consumer on products

Describe the general procedure for collection outstanding bills.

send friendly reminder, send a reminder letter, personal contact, & collecting agency or lawsuit to collect in court

A method of price quotation in which the one price includes both the services and merchandise is?

unit pricing

a cost which is uniform per unit, but fluctuates in total in direct proportion to change in the related total activity or volume

variable expense

Using the preferred formula for quartiles, compute the number of caskets needed in the 1st quartile if there are 8 caskets in the selection room.

0.8

List the 4 most common problems associated with collecting credit payments.

1. older an account becomes, harder to collect 2. attempting to collect money takes time away from other duties 3. former customers avoid the firm 4. collection ties up funds 5. factoring may be necessary

What is meant on a invoice that says "3/15, n/45" as the terms of a credit sale?

3% discount if paid within 15 days, otherwise entire balances due in 45 days

Using the preferred formula for quartiles, compute the number of caskets needed in the 3rd quartile if there are 16 caskets in the selection room.

6.4

Define trade credit.

A form of credit that is extended by one business to another business to help finance distribution of producer's goods.

define revolving credit

A line of credit that may be used over and over again up to a certain borrowing limit.

A method of classifying inventory items with categories which are of high-value, less costly, and/or low-cost items. The funeral director will have a large quantity of low-cost items on hand, very few high-cost items and a moderate number of the middle items.

ABC method

Describe the Equal Credit Opportunity Act.

An act which guarantees equal credit opportunity to all applicants for credit and prohibits credit discrimination on the basis of race, color, religion, national origin, age, marital status, or because all or part of a person's income derives from any public assistance program.

Describe the Consumer Credit Protection Act.

An act which requires a seller to disclose terms of sale and give facts of actual interest rate and other charges.

Describe the Fair Credit Reporting Act.

An act which requires creditors to notify a potential recpient of credit whenever any adverse action or denial of credit was based on a credit report.

Describe the Truth in Lending Act.

An act which requires lenders to inform borrowers of all direct, indirect and true costs of credit.

List some questions which should be considered when determining which suppliers to use.

Can supplier reliably & consistently provide the product? Does supplier prices reflect adequate value? What is the supplier level of customer service? etc

List and describe the 4 types of consumer credit.

Consumer Credit Protection Act: An act which requires a seller to disclose terms of sale and give facts of actual interest rate and other charges; Equal Credit Opportunity Act: An act which guarantees equal credit opportunity to all applicants for credit and prohibits credit discrimination on the basis of race, color, religion, national origin, age, marital status, or because all or part of a person's income derives from any public assistance program; Truth in Lending Act: An act which requires lenders to inform borrowers of all direct, indirect and true costs of credit; Fair Credit Reporting Act: An act which requires creditors to notify a potential recpient of credit whenever any adverse action or denial of credit was based on a credit report.

What is usually done with those slow moving items which do not sell in a reasonable amount of time?

Lower the price until it is perceived value to the customer

Define factoring.

Obtaining cash before payments are received from customers by selling off one's accounts receivable to a third party.