LOSS LEADER Definition

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LOSS LEADER is a featured article of merchandise sold at a loss in order to draw customers.

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FIXED ASSETS (NET) / NET WORTH measures liquidity by comparing "fixed" assets with "fixed" capital. A lower ratio indicates proportionately smaller investment and a better "cushion" for creditors in case of liquidation. This may be important if the fixed assets are not easily used in other businesses. The presence of substantial leased fixed assets (not shown on the balance sheet) may deceptively lower this ratio. Therefore smaller is better, i.e., greater than .75 (75%) should merit caution.

BACKORDER is a customer order or contractual line item, current or past due, that cannot be shipped due to lack of inventory; dependent upon availability it will be shipped at some future date.

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