Dictionary of Accounting Terms: markdown
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- reduction of the original selling price. It may be due to any of several reasons, such as a decline in overall prices of goods, excessive competition, special sale, damaged merchandise, or excess supply. In markdown cancellation, the markdown is partially offset at a subsequent date by increases in the prices of goods that had been marked down below the original selling price. See also markup.
- dealer markdowns in securities trading.
Dictionary of Business Terms: markdown
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reduction in the original retail selling price, which was determined by adding a percentage factor, called a markup, to the cost of the merchandise. The term markdown does not apply unless the price is dropped below the original selling price.
Dictionary of Finance and Investment Terms: markdown
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- amount subtracted from the selling price, when a customer sells securities to a dealer in the Over The Counter market. Had the securities been purchased from the dealer, the customer would have paid a markup, or an amount added to the purchase price. The National Association of Securities Dealers (NASD) rules of fair practice established 5% as a reasonable guideline in markups and markdowns, though many factors enter into the question of fairness, and exceptions are common.
- reduction in the price at which the underwriters offer municipal bonds after the market has shown a lack of interest at the original price.
- downward adjustment of the value of securities by banks and investment firms, based on a decline in market quotations.
- reduction in the original retail selling price, which was determined by adding a percentage factor, called a markon, to the cost of the merchandise. Anything added to the markon is called a markup, and the term markdown does not apply unless the price is dropped below the original selling price.
Dictionary of Marketing Terms: markdown
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reduction in selling price to stimulate demand, take advantage of reduced costs, or force competitors out of the market. Markdowns are common for domestic goods sold in foreign markets where incomes are lower, where wholesalers demand a larger piece of the revenue, and/or where surplus goods are disposed of.
