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
Correct Answer :
B. Unamortised cost is the difference between the original cost of a property and all the depreciation charges made to date
Related Questions
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
'Lang factor' is defined as the ratio of the capital investment to the delivered cost of major equipments. The value of 'Lang factor' for fixed capital investment, for a solid-fluid processing chemical plant ranges from
1.2 to 1.4
2.5 to 2.7
4.2 to 4.4
6.2 to 6.4
Which of the following ceramic packing materials is the costliest of all?
Berl saddles
Raschig rings
Pall rings
Intalox saddles
An investment of Rs. 100 lakhs is to be made for construction of a plant, which will take two years to start production. The annual profit from the operation of the plant is Rs. 20 lakhs. What will be the payback time?
5 years
7 years
12 years
10 years
A shareholder has __________ say in the affairs of company management compared to a debenture holder.
More
Less
Same
No
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
A series of equal payments (e.g., deposit or cost) made at equal intervals of time is known as
Perpetuity
Capital charge factor
Annuity
Future worth
__________ taxes are based on gross earnings.
Property
Excise
Income
Capital gain
According to six-tenths-factor rule, if the cost of a given unit at one capacity is known, then the cost of similar unit with '' times the capacity of the first unit is approximately equal to __________ times the cost of the initial unit.
n
n0.6
n0.4
√n
Equipment installation cost in a chemical process plant ranges from __________ percent of the purchased equipment cost.
10 to 20
35 to 45
55 to 65
70 to 80
Cost incurred towards __________ in a chemical plant is a component of the utilities cost.
Water supply
Running a control laboratory
Property protection
Medical services
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
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
__________ 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
Fixed capital investment of a chemical plant is the total amount of money needed to supply the necessary plant and manufacturing facilities plus the working capital for operation of the facilities. Which of the following components of fixed capital investment requires minimum percentage of it?
Electrical installation cost
Equipment installation cost
Cost for piping
Equipment insulation cost
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
The ratio of gross annual sales to the fixed capital investment is termed as the __________ ratio.
Cash reserve
Capital
Turnover
Investment
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
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
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)
The total investment in a project is Rs. 10 lakhs and the annual profit is 1.5 lakhs. If the project life is 10 years, then the simple rate of return on investment is
15%
10%
1.5%
150%
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
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
Effective and nominal interest rates are equal, when the interest is compounded
Annually
Fortnightly
Monthly
Half-yearly
Payback period
And economic life of a project are the same
Is the length of time over which the earnings on a project equals the investment
Is affected by the variation in earnings after the recovery of the investment
All (A), (B) and (C)
Profit is equal to revenue minus
Book value
Total cost
Operating cost
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
Direct costs component of the fixed capital consists of
Contingencies
Onsite and offsite costs
Labour costs
Raw material costs
__________ of depreciation calculation does not take into account the interest on investments.
Present worth method
Sinking fund method
Sum of the years-digits method
All (A), (B) and (C)
A reactor having a salvage value of Rs. 10000 is estimated to have a service life of 10 years. The annual interest rate is 10%. The original cost of the reactor was Rs. 80000. The book value of the reactor after 5 years using sinking fund depreciation method will be Rs.
40,096
43,196
53,196
60,196