4

# Depreciation

Costs (on annual basis) are constant when the straight line method is used for its determination

Is the unavoidable loss in the value of the plant, equipment and materials with lapse in time

Does figure in the calculation of income tax liability on cash flows from an investment

All (A), (B) and (C)

D. All (A), (B) and (C)

4

# Functional depreciation of an equipment is the measure of decrease in its value due to its

Ageing

Wear and tear

Obsolescence

Breakdown or accident

4

2

10

30

50

4

# Cost incurred towards __________ in a chemical plant is a component of the utilities cost.

Water supply

Running a control laboratory

Property protection

Medical services

4

# Out of the following, the depreciation calculated by the __________ method is the maximum.

Diminishing balance

Straight line

Sum of the years digit

Sinking fund

4

One

Three

Six

Twelve

4

# Pick out the wrong statement.

Gross margin = net income - net expenditure

Net sales realisation (NSR) = Gross sales - selling expenses

At breakeven point, NSR is more than the total production cost

Net profit = Gross margin - depreciation - interest

4

# Which of the following is not a component of working capital?

Raw materials is stock

Finished products in stock

Transportation facilities

Semi-finished products in the process

4

# In financial accounting of a chemical plant, which of the following relationship is invalid?

Assets = equities

Assets = liabilities + net worth

Total income = costs + profits

Assets = capital

4

# The depreciation during the year 'n', in diminishing balance method of depreciation calculation, is calculated by multiplying a fixed percentage 'N' to the

Initial cost

Book value at the end of (n - 1)th year

Depreciation during the (n - 1)th year

Difference between initial cost and salvage value

4

n

n0.6

n0.4

√n

4

# An annuity is a series of equal payments occuring at equal time intervals, and this amount includes the sum of all payments plus interest, if allowed to accumulate at a definite rate of interest from the time of initial payment to the end of annuity term. Ordinary annuity is used in the calculation of the

Manufacturing cost

Depreciation by sinking fund method

Discrete compound interest

Cash ratio

4

# Which of the following is the cheapest material of construction for the storage of sodium hydroxide upto a concentration of 75%?

Stainless steel

Plain carbon steel

Nickel

Copper

4

# 'Six-tenth factor' rule is used for estimating the

Equipment installation cost

Equipment cost by scaling

Cost of piping

Utilities cost

4

# Break-even point is the point of intersection of

Fixed cost and total cost

Total cost and sales revenue

Fixed cost and sales revenue

None of these

4

# Manufacturing cost in a chemical company does not include the

Fixed charges

Direct products cost

4

# Depreciation

Costs (on annual basis) are constant when the straight line method is used for its determination

Is the unavoidable loss in the value of the plant, equipment and materials with lapse in time

Does figure in the calculation of income tax liability on cash flows from an investment

All (A), (B) and (C)

4

# Pick out the wrong statement.

Longer tubes are less expensive per unit heat transfer area as compared to shorter tubes

A cost index is merely a number for a given year showing the cost at that time relative to a certain base year

Turnover ratio of a chemical plant is the ratio of gross annual sales to the fixed capital investment

Plates with butt welded joints are less expensive compared to lap welded joints, because squaring of plates is not necessary

4

# In an ordinary chemical plant, electrical installation cost may be about

10-15% of purchased equipment cost

3-10% of fixed capital investment

Either (A) or (B)

Neither (A) nor (B)

4

# Generally, income taxes are based on the

Total income

Gross earning

Total product cost

Fixed cost

4

1 to 5

10 to 20

25 to 35

35 to 45

4

# In which of the electric power generation system, the operating cost is minimum?

Thermal

Nuclear

Hydroelectric

Fast breeder reactor

4

15000

16105

18105

12500

4

# Which of the following relationship is not correct is case of a chemical process plant?

Manufacturing cost = direct product cost + fixed charges + plant overhead costs

General expenses = administrative expenses + distribution & marketing expenses

Total product cost = manufacturing cost + general expenses

Total product cost = direct production cost + plant overhead cost

4

# Personnel working in the market research group is responsible for the job of

Equipment selection

Product evaluation

Equipment design

Cost estimation

4

# Direct costs component of the fixed capital consists of

Contingencies

Onsite and offsite costs

Labour costs

Raw material costs

4

40,096

43,196

53,196

60,196

4

Property

Excise

Income

Capital gain

4

# Which of the following is not a mathematical method for evaluation of profitability of a chemical process plant?

Cash reserve

Rate of return on investment

Payout period

Discounted cash flow based on full life performance

4

# Optimum number of effects in a multiple effect evaporator is decided by the

Cost benefit analysis

Floor area availability

Terminal parameters

Evaporation capacity required