Fixed charges for a chemical plant does not include the
Interest on borrowed money
Rent of land and buildings
Property tax, insurance and depreciation
Repair and maintenance charges
Correct Answer :
D. Repair and maintenance charges
Related Questions
Relative cost of chemical process plants in India is about __________ percent more than the similar plants in U.S.A.
15
35
55
75
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
Maximum production start up cost for making a chemical plant operational is about __________ percent of the fixed capital cost.
1
5
10
30
For a typical project, the cumulative cash flow is zero at the
End of the project life
Breakeven point
Start up
End of the design stage
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)
Annual depreciation cost are not constant when, the __________ method of depreciation calculation is used.
Straight line
Sinking fund
Present worth
Declining balance
__________ method for profitability evaluation of a project does not account for investment cost due to land.
Net present worth
Pay out period
Discounted cash flow
Rate of return on investment
Optimum economic pipe diameter for fluid is determined by the
Viscosity of the fluid
Density of the fluid
Total cost considerations (pumping cost plus fixed cost of the pipe)
None of these
Chemical engineering plant cost index is used for finding the present cost of a particular chemical plant, if the cost of similar plant at some time in the past is known. The present cost of the plant = original cost × (index value at present/ index value at time original cost was obtained). The most major component of this cost index is
Fabricated equipment and machinery
Process instruments and control
Pumps and compressor
Electrical equipments and material
If the interest rate of 10% per period is compounded half yearly, the actual annual return on the principal will be __________ percent.
10
20
> 20
< 20
In declining balance method of depreciation calculation, the
Value of the asset decreases linearly with time
Annual cost of depreciation is same every year
Annual depreciation is the fixed percentage of the property value at the beginning of the particular year
None of these
The amount of compounded interest during 'n' interest periods is
p[(1+i)n - 1)]
p(1 + i)n
p(1 - i)n
p(1 + in)
A machine has an initial value of Rs. 5000, service life of 5 years and final salvage value of Rs. 1000. The annual depreciation cost by straight line method is Rs.
300
600
800
1000
Most chemical plants use an initial working capital amounting to 10-20% of the total capital investment. But this percentage may increase to __________ percent in case of seasonal products manufacturing plant.
30
50
75
95
The __________ of a chemical company can be obtained directly from the balance sheet as the difference between current assets and current liabilities.
Cash ratio
Net working capital
Current ratio
Liquids assets
__________ of depreciation calculation accounts for the interest on investment.
Straight line method
Declining balance
Both (A) and (B)
Neither (A) nor (B)
Construction expenses are roughly __________ percent of the total direct cost of the plant.
2
10
30
50
Cost of instrumentation in a modern chemical plant ranges from __________ percent of the total plant cost.
5 to 10
20 to 30
40 to 50
60 to 70
Pick out the wrong statement.
Net worth means paid up share capital and reserve & surplus (i.e. shareholders equity)
Return on equity = profit after tax/net worth
Working capital turnover ratio = sales/net working capital
Total cost of production is more than net sales realisation (NSR) at breakeven point
Effective and nominal interest rates are equal, when the interest is compounded
Annually
Fortnightly
Monthly
Half-yearly
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
Depreciation is __________ in profit with time.
Decrease
Increase
No change
None of these
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
The amount of simple interest during 'n' interest period is (where, i = interest rate based on the length of one interest period, p = principal)
p.i.n.
p(1 + i.n)
p(1 + i)n
p(1 - i.n)
Purchased cost of equipments for a chemical process plant ranges from __________ percent of the fixed capital investment.
10 to 20
20 to 40
45 to 60
65 to 75
A balance sheet for a chemical plant shows its financial condition at any given date. It does not contain the __________ of the plant.
Current asset
Current liability
Long term debt
Profit
A present sum of Rs. 100 at the end of one year, with half yearly rate of interest at 10%, will be Rs.
121
110
97
91
Following the six-tenth factor rule, if a loglog plot of capacity of the equipment vs. cost of the equipment is made, then a straight line is obtained, whose slope is equal to
0.1
0.6
0.2
0.8
__________ taxes are based on gross earnings.
Property
Excise
Income
Capital gain
Direct costs component of the fixed capital consists of
Contingencies
Onsite and offsite costs
Labour costs
Raw material costs