Lindenburg ESAS Terms Flashcards
How is the capital recovery factor (A/P,i,n) related to the uniform series sinking fund factor (A/P,i,n)?
i is the effective annual rate of return, and n is the number of periods.
(A/P,i,n)= (A/F,i,n)+ i
A series of uniform amounts over a period of time
Annuity
Which of the following expressions is
INCORRECT?
a. The future worth of a present amount, (F/P,I,n)= 1/(P,F,i,n)
b. The future worth of an annuity,
(F/A,I,n)= 1/(A,F,i,n)
c. The future worth of an annuity,
(P/A,I,n)= 1/(A,P,i,n)
d. (A/F,i,n)-i=(A/P,i,n)
D
(A/F,i,n)+i=(A/P,i,n)
Problems with internal rate of return
calculations that net present worth
handles nicely.
- differences in the magnitudes of the projects
- mutually exclusive projects
- non-conventional cash flows
When using net present worth calculations to compare two projects, what could invalidate the calculation?
evaluating over different time periods
The net present worth of two projects must be calculated for the same time period.
Future worth of a present amount
Assuming:
* i= annual rate of return
* n= number of years
* F= future worth
* P= present worth
F = P(1+i)n
This situation corresponds to a single payment compound amount
Two investments with the same present worth and unequal lives must have _________.
different equivalent uniform annual cash flows.
Formula for a straight-line depreciation rate
100% − % net salvage value
estimated service life
What can be said about the minimum attractive rate of return used in judging proposed investments?
It is frequently a policy decision made by an organization’s management.
- Which of the following statement is NOT
correct?
(A) A nominal rate of 12% per annum compounded quarterly is the same as 12%/4 = 3% quarter.
(B) $1 compounded quarterly at 3% for n yr has a future value of (1.03)4n
(C) Compounding quarterly at a nominal rate of 12%/yr is equivalent to compounding annually at a rate of 12.55%
(D) Effective rate of return in options (A), (B) and (C) is the difference between 12.55% and 12%.
(E) The statement given in options (A), (B) and (C) are correct. Only option (D) is false.
D
An example situation that has a conventional cash flow so that an internal rate of return can be safely calculated and used
You invest in a safe dividend stock and receive dividends each year.
This situation has a negative cash flow, one sign change, then a positive cash flow. Thus, it is a situation that has a conventional cash flow so that an IRR can be safely calculated and used.
The order that minimizes the inventory cost per unit time.
economics order quantity (EOQ)
Assumptions of the basic EOQ model with no shortages
- The demand rate is uniform and constant.
- There is a positive cost on each unit inventoried.
- The entire reorder quantity is delivered instantaneously.
EOQ = sqrt[(2aK)/h]
- a is the constant depletion rate (items per unit time)
- K is the fixed cost per order in dollars
- h is the inventory storage cost (dollars per item per unit time).
Thus, there is no upper bound on the quantity ordered.
Events will cause the optimal lot size, given by the classic EOQ model with no shortages, to increase
Either:
* a decrease in inventory carrying cost, h, or
* an increase in demand, a,
that will cause the optimal lot size to
increase.
EOQ = sqrt[(2aK)/h]
It is what a borrower of a particular loan almost always required to do during repayment
Repay the loan over an agreed-upon amount of time
What is “work in process” classified as?
an asset
Work in process is included in the working fund investments. The working fund investments is an asset not subject to depreciation.
Define:
indirect product cost (IPC)
spending variance
The difference between actual IPC and IPC volume-adjusted buget.
Full absorption costing includes;
all direct and indirect, fixed and variable production costs
Variable product costing leaves fixed costs for the expense accounts. What can be inferred from this?
the cost of goods sold is less under variable costing.
Inventory value (an asset) is ______ under full absorption. Since assets equal ______, the owner’s equity (retained earnings) must ______ as the assets have.
higher, liabilities plus owner’s equity, increase
Define:
material purchase price variance
(quantity purchased) (actual price) - (quantity purchased) (standard price)
Enumerate:
Things that affect owner’s equity
- Dividends paid
- Invested capital
- Expense to get license to start operation
Formula:
Sales
(sales/total assets)(total assets/equity)equity
Sales can grow only if at least _____, _____, or _____ grows.
sales, total assets, equity
Situational Problem:
Z Corporation is applying for a short-term loan. In reviewing Z Corporation’s financial records, the banker finds a current ratio of 2.0, an acid test ratio of 0.5, and an accounts receivable period of 70d. what should the banker do?
(A) Be concerned that Z Corporation will be unable to meet the payments
(B) Suggest that Z Corporation lower its inventories
(C) Suggest that Z Corporation be more aggressive I collecting on its invoices
(D) Both options (B) and (C)
D
Situational problem:
Companies A and B are identical except for their inventory accounting systems. Company A uses the last-in, first-out convention while company B uses the first-in, first-out convention. How will their financial statements differ in an inflationary environment?
(A) Company A’s profits will be higher and the book value of their inventory will be higher than for company B.
(B) Company A’s profits will be higher and the book value of their inventory will be lower than for company B.
(C) Company B’s profits and inventory book value will be higher than for company A.
(D) Company B’s profits will be higher than A’s, but inventory book value will be lower.
C
Last-in, first-out (LIFO) puts a higher value on the inventory that went into the cost of goods sold. Thus, the gross margin is lowered and profits are lowered. The remaining inventory is still valued at old prices, so its value is also low.
Define:
acid test ratio
The ratio of current assets (exclusive of inventory) to total current liabilities
Units of pressure
- kPa
- N/cm3
- Bars
Units of work
- N-m
- Erg (10-7 J)
- kg-m2/s2
Dyne is a unit of?
force
Define:
Joule
A joule is a unit of energy and is defined as a newton-meter (N-M).
Define:
Fluid
A substance that deforms continuously under the application of a shear force.
Fluid cannot sustain a ____ at rest.
shear stress
Enumerate:
Basic components of motion of a fluid element:
- translation
- rotation
- angular distortion
Enumerate:
The flow of any fluid, real or ideal, must satify:
- Newton’s second law
- the continuity equation
- the principle of conservation of energy
Define:
viscosity (of a fluid)
the constant of proportionality between shear stress, τ, and the gradient (spatial derivative) of
the velocity
τ = μ(dv/dy)
enumerate:
Properties of surface tension:
- It has units of force per unit length
- It exists whenever there is a density
discontinuity
Situational Problem:
A leak from a faucet comes out in separate drops. Which of the following is the main cause of this phenomenon?
surface tension
Surface tension is caused by molecular cohesive forces in a fluid. It is the main cause of the formation of the drops of water.
In order for a shear stress to vary linearly with the velocity gradient, the fluid must be _____.
Newtonian
Lines of constant pressure are always _____ to the direction of the force field
perpendicular
Streamlines are _____ to the velocity vectors at every point in the field.
tangent
In a steady flow (dv/dt = 0), a streamline is _____ in space.
fixed
Describe:
A streamline
a mathematical concept that defines lines that are tangential to the velocity vector. Therefore, no flow can cross a streamline. Entropy is not related to streamlines.
Under what conditions is mass conserved in fluid flow?
Mass is always conserved in fluid flow.
The velocity of the surface is _____ velocity of the fluid at the surface.
is the same as the
For a real (nonzero viscosity) fluid there is no slip at the boundaries.
The energy equation for fluid flow is based on _____
the first law of thermodynamics
This law states that the heat input into the system added to the work done on the system is equal to the change in energy of the system.
The basis for Bernoulli’s law for fluid flow
the principle of conservation of energy
Enumerate:
Conditions in which Bernoulli’s equation is valid
- all points evaluated must be on the same streamline
- the fluid must be incompressible
- the fluid must be in viscid
Conditions that are necessary and sufficient to reduce the first law of thermodynamics for a control volume to Bernoulli’s equation
- steady flow
- incompressible fluid
- no frictional losses of energy
- no heat transfer or change in internal energy
Define:
Reynolds numbers
the ratio of the inertial forces on an element of fluid to the viscous forces.
Re =(ρvD)/μ
Steady flows do not change with time at ______.
any point
Define:
The Navier-Stokes equation
the equation of motion for the viscous Newtonian fluid
Define:
Blasius solution
An approximate solution to the boundary layer equations and makes some simplifying assumptions.
Blasius solution is valid for _____, _____ and permits the evaluation of _____ and _____.
laminar, viscous flow, shear stress, skin friction.
The curves in the Moody diagram are _____ . They are valid for _____.
experimental data plots, viscous fluids
Most nearly friction factor for flow in a circular pipe where the Reynolds number is 1000.
0.08
For the pipe flow in the laminar region, how is the friction factor related to the Reynolds number?
In the laminar region, f = 64/Re.
Enumerate:
Flow meters that measure the average fluid velocity rather than a point or local velocity in a pipe?
- venture meter
- orifice meter
For fully developed laminar flow of fluids through circular pipes, the average velocity is what fraction of the maximum velocity?
For laminar flow in pipes,
vave=vmax/2
Define:
intensive property
A property that does not depend on the amount of material present.
Ex.: temperature, pressure, and composition.
Number of independent properties are required to completely fix the equilibrium state of a pure gaseous compound
2
Which of the following thermodynamic relations is INCORRECT?
(A) TdS = dU + pdV
(B) TdS = dH – Vdp
(C) U = Q – W
(D) H = U + pV
C
Enthalpy is given by _____
h = u + pv
For water at a reference temperature where enthalpy is zero,
internal energy is negative
Define:
compressibility factor (Z)
relative to an ideal gas
- Used for predicting the behavior of non-ideal gases.
- z =pV/RT
For real gases, the compressibility factor, Z, is a dimensionless constant given by pV=ZRT. Therefore, Z = pV/RT.
The axes for Mollier diagram are _____ and _____.
enthalpy and entropy (h-s).
Define:
The quality of the liquid-vapour mixture
the fraction of the total mass that is saturated vapour.
Define:
Heat of vaporization
- the difference between the enthalpy of the saturated vapor and the enthalpy of the saturated liquid
- hfg = hg - hf
hg = enthalpy of the saturated vapor
hf = enthalpy of the saturated liquid
Principle to which the first law of thermodynamics is base on
The principle of conservation of energy
The general energy equation for an open system
I = -II + II +IV - V
The first law of thermodynamics states that the total change in energy (I) is equal to the energy in (IV) minus the energy out (V) minus the work done on the system (II) plus the heat transferred to the system (III).
I. accumulation of energy
II. net energy transfer by work (standard sign convention)
III. net energy transfer by heat (standard sign convention)
IV. transfer of energy in by mass flow
V. transfer of energy out by mass flow
The value of the work done for a closed, reversible, isometric system
zero
W = ∫ pdV
An isometric system is a system which has a constant volume (dV = 0).
The expansion of a gas through a plug at a high pressure results in a temperature _____, while at lower pressures a temperature _____ occurs.
rise, drop
Define:
Joule-Thompson coefficient, μJ T
the ratio of the change in temperature to the change in pressure.
Define:
Inversion temperature
the temperature at which μJ T changes from positive to negative
When μJ T < 0, then ∂T/∂p _____. Thus, a pressure rise is accompanied by a temperature drop. Therefore, a gas may be liquefied by _____.
< 0, pressurization
Difference between adiabatic process and isentropic process
Both: heat transfer = 0; isentropic:
reversible
- An adiabatic process is one in which there is no heat flow. It is not necessarily reversible.
- An isentropic process has no heat flow and is reversible.
For a perfect gas undergoing an isobaric process, polytropic exponent, n, is _____.
n = 0
During an adiabatic, internally reversible process, the change in entropy is ____.
always zero
Since there is no heat flow, an adiabatic, reversible process has a zero change in entropy.
The total change in entropy of the system and surroundings for an irreversible process
dS > 0
For an irreversible process,
dS = dSsystem + dSsurroundings > 0
The equation dQ=TdS is valid for a/an _____.
reversible process
The total change in entropy is always _____ to zero.
greater than or equal
∆Ssurroundings ∆Ssystem ≥ 0
The total entropy either increases or, for a reversible process, remains the same.
The most efficient thermodynamic cycle
Carnot Cycle
No cycle is more efficient than the Carnot cycle, because it is completely reversible
The basic processes involved in the ideal reversible Carnot cycle
two isothermal and two isentropic
Enumerate:
Advantages of a superheated, closed Rankine cycle over an open Rankine cycle
- increased efficiency
- increased turbine work output
- increased turbine life
Superheated Rankine cycle has higher boiler heat temperatures that decrease boiler life.
Which of the following statements regarding Rankine cycles is FALSE?
(A) Use of a condensable vapor in the cycle increases the efficiency of the cycle.
(B) The temperatures at which energy is transferred to and from the working liquid are less separated than in a Carnot cycle.
(C) Superheating increases the efficiency of a Rankine cycle.
(D) In practical terms, the susceptibility of the engine materials to corrosion is not a key limitation on the operating efficiency.
D
Enumerate:
Reversible processes that describe an ideal Otto cycle
- adiabatic compression
- constant volume
- heat addition
- adiabatic expansion
- constant volume heat rejection
