The 'total capital investment' for a chemical process plant comprises of the fixed capital investment and the
Overhead cost
Working capital
Indirect production cost
Direct production cost
Correct Answer :
B. Working capital
Related Questions
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
Manufacturing cost in a chemical company does not include the
Fixed charges
Plant overheads
Direct products cost
Administrative expenses
Profit is equal to revenue minus
Book value
Total cost
Operating cost
None of these
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
The 'total capital investment' for a chemical process plant comprises of the fixed capital investment and the
Overhead cost
Working capital
Indirect production cost
Direct production cost
Out of the following, the depreciation calculated by the __________ method is the maximum.
Diminishing balance
Straight line
Sum of the years digit
Sinking fund
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
Functional depreciation of an equipment is the measure of decrease in its value due to its
Ageing
Wear and tear
Obsolescence
Breakdown or accident
Which of the following elements is not included in the scope of market analysis?
Competition from other manufactures
Product distribution
Opportunities
Economics
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
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)
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
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
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
A shareholder has __________ say in the affairs of company management compared to a debenture holder.
More
Less
Same
No
Which of the following is not a current asset of a chemical company?
Inventories
Marketable securities
Chemical equipments
None of these
Generally, income taxes are based on the
Total income
Gross earning
Total product cost
Fixed cost
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
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
__________ 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
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
The economic life of a large chemical process plant as compared to a small chemical plant is
Only slightly more
Much more
Slightly less
Almost equal
The inventory of raw materials included in the working capital is usually about __________ months supply of raw materials valued at delivery prices.
One
Three
Six
Twelve
Which of the following is not a component of the working capital for a chemical process plant?
Product inventory
In-process inventory
Minimum cash reserve
Storage facilities
__________ 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)
In which of the electric power generation system, the operating cost is minimum?
Thermal
Nuclear
Hydroelectric
Fast breeder reactor
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)
'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
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