Profitability index is the ratio of mcq
WebManagement Accounting MCQ Questions and Answers Part – 3 1. The ratios which reflect managerial efficiency in handling the assets is__________. A. turnover ratios. B. profitability atios. C. short term solvency ratio. D. long term solvency ratio. ANSWER: A 2. Webthe PI can be used as a guide to what in a situation of capital rationing. internal rate of return (IRR) the discount rate that equates the present value of the expected net cash …
Profitability index is the ratio of mcq
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http://www.accountingmcqs.com/the-profitability-index-approach-to-investment-ana-mcq-2739 WebHow to Calculate Profitability Index (Step-by-Step) The profitability index ratio measures the monetary benefits (i.e. cash inflows) received for each dollar invested (i.e. cash outflow), with the cash flows discounted back to the present date.. More specifically, the PI ratio compares the present value (PV) of future cash flows received from a project to the initial …
WebBelow is a list of multiple-choice questions and answers on Profit Sharing Ratios to help students understand the topic better. 1. The excess amount which the firm can get on selling its assets, over and above the saleable value of its assets, is called _____. (A) Super profits. WebCapital Budgeting MCQs is a set of important multi-choice questions. This is consists of complete chaper conceptual overviews. ... Profitability index is less than or equal to 1 (d) Profitability index is greater than 10. Correct! ... Internal Rate of Return (c) Benefit Cost Ratio (d) NPV . Correct! Wrong! 5. If you have to judge a project from ...
WebThe profitability index (PI) refers to the ratio of discounted benefits over the discounted costs. It is an evaluation of the profitability of an investment and can be compared with the profitability of other similar investments which are under consideration. the profitability index is also referred to as benefit-cost ratio, cost-benefit ratio, or even capital rationing. WebCreated by. mrg21. Terms in this set (3) Profitability Index. Determines the benefit to cost ratio of a project by computing the value provided per unit of investment. PI Formula …
WebMCQs on Capital Budgeting. Capital Budgeting is the process of making financial decisions regarding investing in long-term assets for a business. It involves conducting a thorough evaluation of risks and returns before approving or rejecting a prospective investment decision. This process is also known as investment appraisal.
WebWhat does the price-to-earnings ratio (P/E) tell you? a) How much each of a company's products sells for on average. b) How much investors are willing to pay per unit of a … ezr p値WebMar 23, 2024 · It is also known as the benefit-cost ratio. Profitability Index is calculated by dividing the present value (PV) of future cash inflow that is generated from the project by … ez rpgWebPI = 1.3. We will use another method to calculate the Profitability Index. PI Formula = 1 + (Net Present Value / Initial Investment Required) PI = 1 + [ (Present Value of Future Cash Flow – Present Value of Cash Outflow)/ Initial Investment Required] PI = 1 + [ (US $130 million – US $100 million)/ US $100 million] PI = 1 + [US $30 million ... ezrrfWebQuestion: The profitability index of an investment project is the ratio of the: Multiple Choice average net income from the project to the average investment cost. net present value of … hikma adpWebMar 13, 2024 · Profitability ratios are financial metrics used by analysts and investors to measure and evaluate the ability of a company to generate income (profit) relative to … ezr pdfWebThe formula for calculating the profitability index is as follows. Profitability Index = Present Value of Future Cash Flows / Initial Investment. Another variation of the PI formula adds … hikma diazepam syringeWebHelp us improve! We want to make our service better for you. Please take a moment to fill out our survey. Take Survey hikmad atau hikmat