In a manufacturing industry, breakeven point occurs, when the
Total annual rate of production equals the assigned value
Total annual product cost equals the total annual sales
Annual profit equals the expected value
Annual sales equals the fixed cost
Correct Answer :
B. Total annual product cost equals the total annual sales
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
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
Pick out the wrong statement.
The annual depreciation rate for machinery and equipments in a chemical process plant is about 10% of the fixed capital investment
Annual depreciation rate of buildings in a chemical plant is about 3% of its initial cost
Insurance rates on annual basis in a chemical plant may be about 1% of the fixed capital investment
In a chemical industry, research and development cost amounts to about 15% of net sales realisation (NSR)
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)
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
Annual depreciation costs are constant, when the __________ method of depreciation calculation is used.
Declining balance
Straight line
Sum of the years digit
None of these
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
In a chemical process plant, the total product cost comprises of manufacturing cost and the
General expenses
Overhead cost
R & D cost
None of these
Cost of piping in a fluid processing unit (e.g., distillation) of a chemical process plant is about __________ percent of the fixed capital investment.
4
13
22
34
A shareholder has __________ say in the affairs of company management compared to a debenture holder.
More
Less
Same
No
Personnel working in the market research group is responsible for the job of
Equipment selection
Product evaluation
Equipment design
Cost estimation
An investment of Rs. 1000 is carrying an interest of 10% compounded quarterly. The value of the investment at the end of five years will be
1000 (1 + 0.1/4)20
1000 (1 + 0.1)20
1000 (1 + 0.1/4)5
1000 (1 + 0.1/2)5
Annual depreciation cost are not constant when, the __________ method of depreciation calculation is used.
Straight line
Sinking fund
Present worth
Declining balance
Cost incurred towards __________ in a chemical plant is a component of the utilities cost.
Water supply
Running a control laboratory
Property protection
Medical services
Generally, income taxes are based on the
Total income
Gross earning
Total product cost
Fixed cost
The value of a property decreases __________ with time in straight line method of determining depreciation.
Linearly
Non-linearly
Exponentially
Logarithmically
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
Scheduling provides information about the
Proper utilisation of machines
Means to minimise idle time for machines
Time of completion of job
Time of starting of job and also about how much work should be completed during a particular period
Operating profit of a chemical plant is equal to
Profit before interest and tax i.e., net profit + interest + tax
Profit after tax plus depreciation
Net profit + tax
Profit after tax
Expenditure on research and development (R & D) is categorised as the __________, while making an estimate of the total product cost for a chemical plant.
Overhead cost
Fixed expenses
General expenses
Direct production cost
'Utilities' in a chemical process plant includes compressed air, steam, water, electrical power, oxygen, acetylene, fuel gases etc. Utility costs for ordinary chemical process plants ranges roughly from __________ percent of the total product cost.
1 to 5
10 to 20
25 to 35
35 to 45
Pick out the wrong statement.
Gross revenue is that total amount of capital received as a result of the sale of goods or service
Net revenue is the total profit remaining after deducting all costs excluding taxes
The ratio of immediately available cash to the total current liabilities is known as the cash ratio
Consolidated income statement based on a given time period indicates surplus capital and shows the relationship among total income, costs & profit over the time interval
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
Pick out the wrong statement.
Debt-equity ratio of a chemical company describes the lenders contribution for each rupee of owner's contribution i.e., debt-equity ratio = total debt/net worth
Return on investment (ROI) is the ratio of profit before interest & tax and capital employed (i.e. net worth + total debt)
Working capital = current assets + current liability
Turn over = opening stock + production closing stock
The payback method for the measurement of return on investment
Gives a correct picture of profitability
Underemphasises liquidity
Does not measure the discounted rate of return
Takes into account the cash inflows after the recovery of investments
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)
Functional depreciation of an equipment is the measure of decrease in its value due to its
Ageing
Wear and tear
Obsolescence
Breakdown or accident
Accumulated sum at the end of 5 years, if Rs. 10000 is invested now at 10% interest per annum on a compound basis is Rs.
15000
16105
18105
12500
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