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
Correct Answer :
C. Annual depreciation is the fixed percentage of the property value at the beginning of the particular year
Related Questions
The ratio of gross annual sales to the fixed capital investment is termed as the __________ ratio.
Cash reserve
Capital
Turnover
Investment
'Six-tenth factor' rule is used for estimating the
Equipment installation cost
Equipment cost by scaling
Cost of piping
Utilities cost
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
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
Relative cost of chemical process plants in India is about __________ percent more than the similar plants in U.S.A.
15
35
55
75
__________ taxes are based on gross earnings.
Property
Excise
Income
Capital gain
Factory manufacturing cost is the sum of the direct production cost
Fixed charges and plant overhead cost
And plant overhead cost
Plant overhead cost and administrative expenses
None of these
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
Annual depreciation cost are not constant when, the __________ method of depreciation calculation is used.
Straight line
Sinking fund
Present worth
Declining balance
In which of the electric power generation system, the operating cost is minimum?
Thermal
Nuclear
Hydroelectric
Fast breeder reactor
Total product cost of a chemical plant does not include the __________ cost.
Market survey
Operating labour, supervision and supplies
Overhead and utilities
Depreciation, property tax and insurance
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)
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
Profit is equal to revenue minus
Book value
Total cost
Operating cost
None of these
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)
__________ of depreciation calculation accounts for the interest on investment.
Straight line method
Declining balance
Both (A) and (B)
Neither (A) nor (B)
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
'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
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
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
Effluent treatment cost in a chemical plant is categorised as the __________ cost.
Fixed
Overhead
Utilities
Capital
Construction expenses are roughly __________ percent of the total direct cost of the plant.
2
10
30
50
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
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
Which of the following is a component of working capital investment?
Utilities plants
Maintenance and repair inventory
Process equipments
Depreciation
Gross earning is equal to the total income minus
Total product cost
Fixed cost
Income tax
None of these
Which of the following is not a current asset of a chemical company?
Inventories
Marketable securities
Chemical equipments
None of these
Maximum production start up cost for making a chemical plant operational is about __________ percent of the fixed capital cost.
1
5
10
30
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