Presentation on theme: "1)A project costs Rs.16,000.The estimated annual cash inflows during its 3 year life are Rs.8,000, Rs.7,000 and Rs.6,000 respectively.What will be the."— Presentation transcript:
1 1)A project costs Rs.16,000.The estimated annual cash inflows during its 3 year life are Rs.8,000, Rs.7,000 and Rs.6,000 respectively.What will be the pay-back period? a) 2 years b) 2.5 years c) 3 years d) 4 years
2 2) Cost of a project is Rs. 12,000 annual cash inflows Rs 2) Cost of a project is Rs.12,000 annual cash inflows Rs.2,000 life 8 years & cost of capital is 10%.If the present value of Re.1received annually for 8 years at 10% rate is ,calculate the present value index.0.50%b) 0.60%c) 0.89%d) 0.75%
3 3) A project which costs Rs 3) A project which costs Rs.1,20,000 is expected to yield total earnings after depreciation and tax of Rs.60,000 over 3 years.The scrap value of the project after 3 years has been calculated at Rs.20,000.Calculate the average return ofinvestment.a) 10%b) 20%c) 30%d) 25%.
4 4) A project of Rs. 20,00,000 yielded annually profit of Rs 4) A project of Rs.20,00,000 yielded annually profit of Rs.3,00,000 after depreciation at 12.5% and is subject to income tax at 50%.Calculate pay-back period?2yearsb) 3yearsc) 5yearsd) 4years
5 5)Profit maximization is a Short term conceptb) long term conceptc)bothd) none of the above
6 6)Wealth maximization is a Short term conceptb) long term conceptc) either a or bd) both a& b.
7 7)Criterion for payback period Accept PBP>target periodb) period Accept PBP<targetc) Accept PBP=target periodd) none of the above
8 8)Criterion for accounting rate of return Accept ARR>target rateb) Accept ARR< target ratec) Accept ARR=target rate.d) none of the above
9 9)Criterion for Net Present Value a)Accept NPV>0b) Accept NPV<0c) Accept NPV=0d) none of the above
10 10)Criterion for IRR(Internal Rate of Return) Accept IRR>Cost of capitalb) Accept IRR <Cost of capitalc) Accept IRR= Cost of capitald) none of the above
11 11)Criterion for benefit cost ratio Accept BCR>1b) Accept BCR<1c) Accept BCR=1d) none of the above
12 12)Common size statements are Financial Statements that depict financial data in the form of verticle percentagesb) Financial Statements that depict financial data in the form of horizontal percentagesc) All financial statements d) none of the above.
13 13)Horizontal Analysis is a)Changes in financial statementsb) percentage analysis of increase & decrease in corresponding items in comparative financial statements.c) Financial statements which depict financial data.d)none of the above.
14 14)Fund Flow isa) Sources & Uses statementb) Sources Statementc) Uses Statementd) none of the above.
15 15)Economic Income is defined as a) Change in wealthb) Change in incomec) Change in profitd) none of the above