Test 2

Question 1

A pricing procedure which creates a total price for service and casket is called:

Answer 1

Unit

Question 2

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

Answer 2

Merchandising

Question 3

If the wholesale casket cost is $600 and the retail price is $1500, figure the margin:

Answer 3

$900

Question 4

The Economic Order Quantity (EOQ) is the quantity to be purchased which minimizes total cost in an effort to increase profits (T/F)

Answer 4

True

Question 5

The excess of selling price over cost of merchandise:

Answer 5

Gross profit

Question 6

The FTC allows the funeral director to offer special pricing packages along with other pricing systems (T/F)

Answer 6

True

Question 7

Higher priced caskets are given a lower markup when using the Graduated Recovery method of pricing (T/F)

Answer 7

False

Question 8

If an invoice is noted: 2/10, net 30, then there is a cash discount of 2% available if paid within 10 days (T/F)

Answer 8

True

Question 9

Using the Modified Declining Price method provides for a reduced markup on the low-end casket thus providing an option for families to purchase lower-priced caskets, and the CVI improves with the higher priced caskets (T/F)

Answer 9

True

Question 10

Offering a family a place to sit in the selection room is the only reason to have a placement of furniture available (T/F)

Answer 10

False

Question 11

The method whereby the selection of the casket is made without the funeral director present:

Answer 11

Indirect selling

Question 12

A pricing procedure which places a price on each and every item of service and merchandise is called:

Answer 12

Itemized pricing

Question 13

A Balanced Line of merchandise is an old term used to describe having the correct number of caskets in each pricing quartile (T/F)

Answer 13

True

Question 14

The Straight Line method of pricing is easy to use, provides quality control and has a constant CVI (T/F)

Answer 14

True

Question 15

The price of the funeral is based on:

Answer 15

• Overhead
• Human need
• Competition
• Business ethics

Question 16

There are several characteristics of the cremation consumer. The consumer that typically calls on a price and service best describes which segment?

Answer 16

Baby Boomers

Question 17

The sum of a group of figures divided by the number of items

Answer 17

• Mean

* Average

Question 18

Cremation began during:

Answer 18

Early Stone Ages

Question 19

The advantage of itemized pricing to the funeral home is:

Answer 19

Increased gross profit due to placement of a profit on each item

Question 20

A church truck may be used as a casket standard if necessary (T/F)

Answer 20

True

Question 21

Sum of a group of figures divided by the number of units

Answer 21

Mean

Question 22

Advantage of the bi-unit pricing method:

Answer 22

Displays a more realistic value placed on the casket

Question 23

Find the mode. A director’s sales for the week were: $750, $1100, $1100, $1225, $1250, $1525, $1100, and $1100

Answer 23

$1100

Question 24

The direct selection room presentation allows the family to have privacy and offers support (T/F)

Answer 24

False

Question 25

The middle number when the numbers are arranged in their increasing value

Answer 25

Median

Question 26

The wholesale cost of a casket is $600 and the retail price is $1500. What is the CVI?

Answer 26

40

Question 27

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

Answer 27

Inventory turnover

Question 28

If the wholesale casket cost is $750 and the total of the service and merchandise is $5300, what is the MVR

Answer 28

14

Question 29

A method of pricing which places a price on three separate items of the service such as casket, facilities, and automobiles is called:

Answer 29

Functional

Question 30

The method whereby the selection of the casket is made with the funeral director present

Answer 30

Direct selling

Question 31

As noted in the Declining Price Structure method, the higher priced caskets are given a lower markup and the lower priced caskets are given a higher markup which may be too aggressive for some markets (T/F)

Answer 31

True

Question 32

Although they practiced earth burial, cremation was the predominant mode of disposition in Greece (T/F)

Answer 32

True

Question 33

If a casket cost $500 wholesale and the funeral home's fixed multiple is 5, then the selling price of the casket would be:

Answer 33

$2500

Question 34

What are factors which may influence pricing?

Answer 34

* Legislation / fair trade laws * Production costs * Distribution costs * Purchasing practices

Question 35

If the director's sales for the week were $750, $2400, $4500, $3000, and $2500, find the median

Answer 35

$2500

Question 36

The amount added to the cost of an article to determine the selling price of that article

Answer 36

Mark-up

Question 37

The demonstration or educational group of caskets should incorporate five or six caskets to educate the selecting party regarding the various elements of caskets and their features (T/F)

Answer 37

False

Question 38

The FTC requires that funeral directors use an itemized pricing system (T/F)

Answer 38

True

Question 39

Caskets may be grouped in the selection room by:

Answer 39

* Appearance * Style * Alternating pricing * Materials

Question 40

Research studies have found that cremation consumers are more educated, less religious and have higher employment and income levels (T/F)

Answer 40

True

Question 41

A group of three or four caskets utilized to educate the selecting party in the construction and features of the casket itself

Answer 41

Demonstration or educational group

Question 42

Any pricing method would take into consideration

Answer 42

* Price gap * Mark-up on wholesale casket cost * Wholesale casket cost * Sales goals and objectives

Question 43

The Economic Order Quantity (EOQ) represents the number of times the average inventory has been sold or used up during a certain period (T/F)

Answer 43

False

Question 44

That number which occurs most frequently

Answer 44

Mode

Question 45

Sales objectives should include considerations for cost of living increases, cost of goods increases, legitimate profit and suppliers' recommendations (T/F)

Answer 45

True

Question 46

A pricing procedure which places a separate price on casket and a separate price on service fee is called:

Answer 46

Bi-unit pricing

Question 47

Survey statistics indicate that the primary reason people choose cremation is because it is simpler and saves land (T/F)

Answer 47

False

Question 48

Disadvantage of itemized pricing:

Answer 48

Possible elimination of certain items of service resulting in loss of overhead recovery

Question 49

A director's sales for the week were $750, $2400, $4500, $3000, and $2500. What is the mean?

Answer 49

$2630

Question 50

The indirect selection room procedure offers families support and privacy without influencing the selection (T/F)

Answer 50

False