CHEMICAL ENGINEERING PLANT ECONOMICS QUIZ

The inventory of raw materials included in the working capital is usually about __________ months supply of raw materials valued at delivery prices.

One

Six

Three

Twelve

TRUE ANSWER : ?
YOUR ANSWER : ?

In financial accounting of a chemical plant, which of the following relationship is invalid?

Assets = liabilities + net worth

Total income = costs + profits

Assets = capital

Assets = equities

TRUE ANSWER : ?
YOUR ANSWER : ?

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

None of these

Inventories

Chemical equipments

Marketable securities

TRUE ANSWER : ?
YOUR ANSWER : ?

Operating profit of a chemical plant is equal to

Profit after tax plus depreciation

Profit after tax

Net profit + tax

Profit before interest and tax i.e., net profit + interest + tax

TRUE ANSWER : ?
YOUR ANSWER : ?

Relative cost of chemical process plants in India is about __________ percent more than the similar plants in U.S.A.

55

75

15

35

TRUE ANSWER : ?
YOUR ANSWER : ?

Following the six-tenth factor rule, if a log-log plot of capacity of the equipment vs. cost of the equipment is made, then a straight line is obtained, whose slope is equal to

0.6

0.2

0.8

0.1

TRUE ANSWER : ?
YOUR ANSWER : ?

In declining balance method of depreciation calculation, the

Annual depreciation is the fixed percentage of the property value at the beginning of the particular year

Annual cost of depreciation is same every year

Value of the asset decreases linearly with time

None of these

TRUE ANSWER : ?
YOUR ANSWER : ?

Depreciation

Does figure in the calculation of income tax liability on cash flows from an investment

Costs (on annual basis) are constant when the straight line method is used for its determination

All of these

Is the unavoidable loss in the value of the plant, equipment and materials with lapse in time

TRUE ANSWER : ?
YOUR ANSWER : ?

Which of the following is not a mathematical method for evaluation of profitability of a chemical process plant?

Payout period

Cash reserve

Discounted cash flow based on full life performance

Rate of return on investment

TRUE ANSWER : ?
YOUR ANSWER : ?

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)

TRUE ANSWER : ?
YOUR ANSWER : ?