4

# Pick out the correct statement.

Difference between income and expense is termed as gross revenue

Unamortised cost is the difference between the original cost of a property and all the depreciation charges made to date

Sum-of-the-years-digits methods of depreciation calculation accounts for the interest on the investment

Scrap value is the net amount of money obtainable from the sale of used property over and above any charges involved in its removal & sale

B. Unamortised cost is the difference between the original cost of a property and all the depreciation charges made to date

4

One

Three

Six

Twelve

4

10

20

> 20

< 20

4

# Which of the following methods of depreciation calculations results in book values greater than those obtained with straight line method?

Multiple straight line method

Sinking fund method

Declining balance method

Sum of the years digit method

4

5 to 10

20 to 30

40 to 50

60 to 70

4

15%

10%

1.5%

150%

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

# 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

# Which of the following is not a current asset of a chemical company?

Inventories

Marketable securities

Chemical equipments

None of these

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

# 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

# Nominal and effective interest rates are equal, when the interest is compounded

Quarterly

Semi-annually

Annually

In no case, they are equal

4

15000

16105

18105

12500

4

# 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

4

1

5

10

30

4

# 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

4

# 'P' is the investment made on an equipment, 'S' is its salvage value and 'n is the life of the equipment in years. The depreciation for Rath year by the sum-of years digit method will be

(P - S)/n

1 - (P/S)1/m

(m/n) (P - S)

[2 (n - m + 1)/n(n + 1)]. (P - S)

4

# 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

4

# __________ of depreciation calculation accounts for the interest on investment.

Straight line method

Declining balance

Both (A) and (B)

Neither (A) nor (B)

4

300

600

800

1000

4

# A balance sheet for an industrial concern shows

The financial condition at any given time

Only current assets

Only fixed assets

Only current and fixed assets

4

10 to 20

20 to 40

45 to 60

65 to 75

4

# Generally, income taxes are based on the

Total income

Gross earning

Total product cost

Fixed cost

4

0.1

0.6

0.2

0.8

4

# Which of the following elements is not included in the scope of market analysis?

Competition from other manufactures

Product distribution

Opportunities

Economics

4

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

Equipment installation cost

Equipment cost by scaling

Cost of piping

Utilities cost

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

p[(1+i)n - 1)]

p(1 + i)n

p(1 - i)n

p(1 + in)

4

Raschig rings

Pall rings

4

# 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