Which method does not consider the time value of money
A. Net present value
B. Internal Rate of Return
C. Average rate of return
D. Profitability Index

1 Answer

Answer :

C. Average rate of return

Related questions

Description : When operating under a single-period capital-rationing constraint, you may first want to try selecting projects by descending order of their in order to give yourself the best chance to select the mix of ... net present value (NPV) C. internal rate of return (IRR) D. payback period (PBP)

Last Answer : B. net present value (NPV)

Description : When operating under a single-period capital-rationing constraint, you may first want to try selecting projects by descending order of their in order to give yourself the best chance to select the mix of ... net present value (NPV) C. internal rate of return (IRR) D. payback period (PBP)

Last Answer : B. net present value (NPV)

Description : Which of the following statements is correct regarding the internal rate of return (IRR) method? A. Each project has a unique internal rate of return. B. As long as you are not dealing with ... of return is rarely used by firms today because of the ease at which net present value is calculated

Last Answer : D. The internal rate of return is rarely used by firms today because of the ease at which net present value is calculated.

Description : Which of the following statements is correct regarding the internal rate of return (IRR) method? A. Each project has a unique internal rate of return. B. As long as you are not dealing with ... of return is rarely used by firms today because of the ease at which net present value is calculated.

Last Answer : D. The internal rate of return is rarely used by firms today because of the ease at which net present value is calculated.

Description : Which of the following statements is correct regarding the internal rate of return (IRR) method? A. Each project has a unique internal rate of return B. As long as you are not dealing with ... of return is rarely used by firms today because of the ease at which net present value is calculated

Last Answer : D. The internal rate of return is rarely used by firms today because of the ease at which net present value is calculated.

Description : _________ method for profitability evaluation of a project does not account for investment cost due to land. (A) Net present worth (B) Pay out period (C) Discounted cash flow (D) Rate of return on investment

Last Answer : (B) Pay out period

Description : Discounted cash flow criteria for investment appraisal does not include A. Not present value B. Benefit cost ratio C. Accounting rate of return D. Internal rate of return

Last Answer : B. Benefit cost ratio

Description : Super profit mean A. Average Profit – Net profit B. Average Profit – Normal rate of return C. Weighted Average Profit D. Net profit – Average Profit

Last Answer : A. Average Profit – Net profit

Description : In case of the indivisible projects, which of the following may not give the optimum result? A. Internal Rate of Return B. Profitability Index C. Feasibility Set Approach D. All of the above

Last Answer : C. Feasibility Set Approach

Description : _____________ may be defined as the excess of present value of project cash inflows over that of out flows. A. Net present value technique. B. Average rate of return. C. Benefit-Cost ratio. D. Internal rate of return

Last Answer : A. Net present value technique.

Description : Which one is more appropriate for cost of retained earning? A. Weighted Average cost of capital B. Opportunity cost to the firm C. Expected rate of return by the investor D. None of the above

Last Answer : B. Opportunity cost to the firm

Description : The return on investment (ROI) may be calculated as A. Net profit before interest, tax and dividend / Capital employed B. Net profit after interest, tax and dividend / Shareholder's fund C. ( Net profit - preference dividend )/ No. of equity shares D. Return on Investment / Net profit ratio

Last Answer : A. Net profit before interest, tax and dividend / Capital employed

Description : Valuation of stock in accounting follows the principle of cost price or ____ which ever is lower. a) Market Price b) Average Price c) Net realizable Value d) None of these.

Last Answer : c) Net realizable Value

Description : Suppliers and creditors of a firm are interested in A. Profitability position B. Liquidity position C. Market share position D. Debt position

Last Answer : B. Liquidity position

Description : The payback method for the measurement of return on investment (A) Gives a correct picture of profitability (B) Underemphasises liquidity (C) Does not measure the discounted rate of return (D) Takes into account the cash inflows after the recovery of investments

Last Answer : (C) Does not measure the discounted rate of return

Description : Which of the following is not a mathematical method for evaluation of profitability of a chemical process plant? (A) Cash reserve (B) Rate of return on investment (C) Payout period (D) Discounted cash flow based on full life performance

Last Answer : (A) Cash reserve

Description : Which of the following statements is not correct? A. For the purpose of Funds Flow Statement, the term 'fund ' generally refers to net working capital B. Funds flow is a wider concept than ... business D. The capitalisation of reserves by the issue of bonus shares also involves flow of funds

Last Answer : D. The capitalisation of reserves by the issue of bonus shares also involves flow of funds

Description : A profitability index (PI) of .92 for a project means that . A. The project's costs (cash outlay) are (is) less than the present value of the project's benefits B. The project's NPV is ... is greater than 1 D. The project returns 92 cents in present value for each current rupee invested (cost)

Last Answer : C. The project's NPV is greater than 1

Description : The index of efficiency and profitability of the business a) Operating ratio b) Operating profit ratio c) Expense ratio d) Net profit ratio

Last Answer : b) Operating profit ratio

Description : Which of following is not Method of calculation of Purchas Consideration? A. Lump sum Method B. Net Asset Method C. Net Payment Method D. Annuity Method

Last Answer : D. Annuity Method

Description : If amalgamation is in the ..............., the General Reserve or Profit and Loss A/c balance will not be shown in the balance sheet. (A)Form of Merger (B)Form of purchase (C)Net assets method (D)Consideration method

Last Answer : (B)Form of purchase

Description : Which of the following is not included in the assumption on which Myron Gorden proposed a model on Stock valuation A. Retained earning the only source of financing B. Finite Life of the firm C. Taxes do not exist D. Constant rate of return on firms investment.

Last Answer : B. Finite Life of the firm

Description : Historical cost concept requires the valuation of an asset at A] Original cost B] Replacement value C] Net realizable value D] Market value

Last Answer : A] Original cost

Description : Which of the following statement is correct? (A)The amount of Goodwill or Capital Reserve is found out in the books of purchasing company only (B)The amount of Goodwill or ... face value of shares of purchasing company will be taken in to account while calculating purchase consideration.

Last Answer : (A)The amount of Goodwill or Capital Reserve is found out in the books of purchasing company only

Description : Debt financing is a cheaper source of finance because of A. Time value of Money B. Rate of Interest C. Tax deductibility of Interest D. Dividends not payable to lenders.

Last Answer : C. Tax deductibility of Interest

Description : With regard to the rate of return on investment (ROI), which one of the following statements is not valid ? (A) It is an overall indicator of the profitability of an enterprise (B) It is a ... superior measure compared to the cash flow generated per share (D) It was first developed by Dupont, USA

Last Answer : Answer: It is a superior measure compared to the cash flow generated per share

Description : Describe profitability evaluation by rate of return on investment. 

Last Answer : Profitability by ROI Return on investment, or ROI, is the most common profitability ratio. There are several ways to determine ROI, but the most frequently used method is to divide net profit by total ... investment types. Return on investment = (revenue − cost of goods sold) / cost of goods sold

Description : A project has a Profitability Index of 1.30. What does it mean?  A.The NPV is less than zero B.The payback period is more than one year  C.That the project returns Rs 1.30 for every Re 1 invested in the project  D.That IRR is 1.30 times that of the Hurdle Rate

Last Answer : C.That the project returns Rs 1.30 for every Re 1 invested in the project

Description : Which of following is not the method of valuation of Goodwill? A. Average profit Method B. Super profit Method C. Capitalization Method D. Straight line Method

Last Answer : D. Straight line Method

Description : Which one is not an element of internal environment? A. Marketing capabilities B. Operational Capabilities C. Money and capital market D. Personal Capabilities

Last Answer : C. Money and capital market

Description : Relief-from-royalty method estimates the value an asset based on the value of the royalty payments __________. a) from which the company is relieved due to its ownership of the asset b) made by the ... by the company from the useful life of the asset d) over and above the internal rate of return

Last Answer : a) from which the company is relieved due to its ownership of the asset

Description : The internal rate of return - (1) must be less than the interest rate if the firm is to in-vest. (2) makes the present value of profits equal to the present value of costs. (3) falls as the annual yield of an investment rises. (4) is equal to the market interest rate for all the firm's in-vestment.

Last Answer : (3) falls as the annual yield of an investment rises. Explanation: The internal rate of return on an investment or project is the "annualized effective compounded re-turn rate" or discount rate ... the investment equals the net present value of the benefits (positive cash flows) of the investment.

Description : The internal rate of return (1) must be less than the interest rate if the firm is to invest. (2) makes the present value of profits equal to the present value of costs. (3) falls as the annual yield of an investment rises. (4) is equal to the market interest rate for all the firm’s investment. 

Last Answer : falls as the annual yield of an investment rises.

Description : ROI stands for? A. Return on Investment B. Ratio of Investment C. Return of Income D. None of these

Last Answer : A. Return on Investment

Description : In the calculation of return on shareholders investments the referred investment deals with A. All reserves B. Preference and equity capital only C. All appropriations D. All of the above

Last Answer : D. All of the above

Description : The shares received from the new company is recorded at (A) Face value (B) Market value (C) Average price (D) None of these

Last Answer : (B) Market value

Description : While calculating purchase consideration ............... values of assets is to be considered. (A) Book value (B) Revalued price (C) Average price (D) Capital

Last Answer : (B) Revalued price

Description : Shares received from the new company are recorded at - (A)Face value (B)Average price (C)Market value (D)None of the above

Last Answer : (C)Market value

Description : While calculating purchase price, the following values of assets are considered (A)Book value (B)New values fixed (C)Average values (D)Market values

Last Answer : (B)New values fixed

Description : Sales –Gross Profit = ________ a) Cost of goods sold b) Net sales c) Gross Sales d) Liabilities

Last Answer : a) Cost of goods sold

Description : WAN stands for a. Wap Area Network b. Wide Area Network c. Wide Array Net d. Wireless Area Network

Last Answer : b. Wide Area Network

Description : Corporate dividend tax is _______ A. Computed on Net profit B. Computed on Share Capital C. Computed on Goss Profit D. Computed on Dividend paid

Last Answer : D. Computed on Dividend paid

Description : Following is the application of fund A. Decrease in balance of Fixed Asset B. Decrease in working capital C. Decrease in net profit D. Decrease in preliminary expenses

Last Answer : C. Decrease in net profit

Description : Hitanshi Ltd.‘s purchase consideration is Rs.12,345 and Net Assets Rs.3,568, then........... (A) Goodwill Rs. 8,777 (B) Capital Reserve Rs. 8,777 (C)Goodwill Rs. 15,913 (D) Capital Reserve R

Last Answer : (A) Goodwill Rs. 8,777

Description : Net Assets minus Capital Reserve is _________ (A) Goodwill (B) Total assets (C) Purchase consideration (D) None of these

Last Answer : (C) Purchase consideration

Description : The first electronic general purpose digital computer built by Motley and Accrete called ENIAC did not work on the stored program concept. How many number s could it store in its internal memory? a. 100 b. 20 c. 40 d. 80

Last Answer : b. 20

Description : Which computer memory is used for storing programs and data currently being processed by the CPU? a. Mass memory b. Internal memory c. Non-volatile memory d. PROM

Last Answer : b. Internal memory

Description : Which one of the following branches of accounting primarily deals with processing and presenting of accounting data for internal use? A. Financial accounting B. Tax accounting C. Management accounting D. Inflation accounting

Last Answer : C. Management accounting

Description : When company purchases the business of another company ........ comes into existence. (A)Amalgamation (B)Absorption (C)External Reconstruction (D)Internal Reconstruction

Last Answer : (B)Absorption