Lakshya Education MCQs

Question: Which of the following is not a component of working capital?
A.Raw materials is stock
B.Finished products in stock
C.Transportation facilities
D.Semi-finished products in the process
Answer: Option C

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Question 1. Functional depreciation of an equipment is the measure of decrease in its value due to its
  1.    Ageing
  2.    Wear and tear
  3.    Obsolescence
  4.    Breakdown or accident
Answer: Option C
Question 2. The value of a property decreases __________ with time in straight line method of determining depreciation.
  1.    Linearly
  2.    Non-linearily
  3.    Exponentially
  4.    Logarithmically
Answer: Option A
Question 3. The economic life of a large chemical process plant as compared to a small chemical plant is
  1.    Only slightly more
  2.    Much more
  3.    Slightly less
  4.    Almost equal
Answer: Option B
Question 4. Fixed charges for a chemical plant does not include the
  1.    Interest on borrowed money
  2.    Rent of land and buildings
  3.    Property tax, insurance and depreciation
  4.    Repair and maintenance charges
Answer: Option D
Question 5. A machine has an initial value of Rs. 5000, service life of 5 years and final salvage value of Rs. 1000. The annual depreciation cost by straight line method is Rs.
  1.    300
  2.    600
  3.    800
  4.    1000
Answer: Option C
Question 6. For a typical project, the cumulative cash flow is zero at the
  1.    End of the project life
  2.    Break even point
  3.    Start up
  4.    End of the design stage
Answer: Option B

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