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CHE 319

CHE 319 TEST 1- 2011/2012 SESSION

QUESTION 1

Discuss the roles and main activities of scientific research and development in
technology management.

Ans: Some of the main roles of R&D in tech. mgt include: Continuous innovation of
the technology (i.e. continual improvement upon existing technology so it doesnt go
out of date). Another is Quality assurance as R&D helps to identify defects and
problems that are likely to occur when the product is in use and in turn prevents such
for better quality. Other roles/activities of R&D are in managing time, improving
efficiency of production process,

QUESTION 3

i. Define the following;


a. AMMORTIZATION
b. ACCOUNT RECIEVABLE

Ans (a) It is the apportioning the value of an asset over a period of time usually
the number of years of its useful life

(b) Account receivable refers to the amount of money that is owed to a firm
as a result of goods purchased from the firm by customers on credit

ii. a. Using LIFO/FIFO, obtain the total cost goods sold if 500 units of goods
are sold out of the goods stated below
250 @ N10.00

200 @ N7.50

100 @ N5.00

200 @ N4.00

b. Also, obtain the INVENTORY VALUE

ANS:

Using LIFO (Last IN First Out method), we have

COGS=(200 x N4) + (100 x N5) + (200 x N7.5) = N2,800

Inventory value: (250 x 10)=N2500


2011/2012 CHE 319 TEST 2

QUESTION 1

Technologies are bound to lose value if not well managed. Relating the medium by
which sport celebrities, as well as excellent role models, attain world class status to
budding companies, how can a company with vision-improvement plans and
attitudes draw from these role models.

Ans: Ways in which a company can attain world class status: (a) Quality Assurance
through R&D (b) Vision-driven and highly focused (c) Avoid procrastination (d)
Team work

(e) Effective planning

QUESTION 2

OBAMA and company producing consumer products incurred the following


expenses in producing 240,000 tonnes of products per annum.

ITEM COSTS/MONTHS
(N000)
1. Raw materials 5,000
2. Utilities 150
3. Travels/ Hotels/ Commission 50
4. Stationery 50
5. Postages & Internet 25
6. Salaries & Wages 1,750
7. Rents, Taxes, Insurance, Repairs and Goods 450
Consumables
8. Interest on N250,000,000 @ 12.5% PER ANNUM
9. Bank loan of N12,000,000 @ 25% interest per
annum
10. Pre-investment costs N1,750,000
Besides, the company also made the following acquisitions

Building costing .. N21, 500,000

Machinery & Equipment . N150, 000,000

Office Machines N1, 500,000

Vehicles . N12, 000,000

Some amounts were also spent on the following items

Wages for 50 casual workers @ N2, 500 per day


Packaging materials @ N250 per kg

Shift allowance for 50 workers @ N2,500 per day.

Using the data above, determine d following

a. The total cost of production


b. The unit production cost per kg of the goods
c. Debt: Equity ratio

Ans:

ITEM Calculation COSTS/MONTHS


(N000)
1. Raw materials 5,000
2. Utilities 150
3. Travels/ Hotels/ Commission 50
4. Stationery 50
5. Postages & Internet 25
6. Salaries & Wages 1,750
7. Rents, Taxes, Insurance, 450
Repairs and Goods
Consumables 250000000x0.125 31,250
8. Interest on N250,000,000 @
12.5% PER ANNUM 12000000x0.25 30,000
9. Bank loan of N12,000,000 @
25% interest per annum 1,750
10. Pre-investment costs
N1,750,000
11. Building 21, 500
12. Machinery 150,000
13. Office machines 1,500
14. Vehicles 12,000
15. Wages for 50 casual workers 50 x 2,500 x 37,500
300=37,500,000
16. Packaging materials 250 x 240,000 x 60,000,000
1000=60,000,000,000
17. Shift allowance for 50 workers 50 x 2500 x 300 37,500
=37,500,000
TOTAL 60,330,475
Note: In a production year, we have 300 working days and 1 tonne =1000kg and the
(,000) was removed after making the calculations to allow for uniformity in the 3rd
column

a) Total cost of production = N60,330,475,000


N60,330,475,000
b) Unit cost of production = = N251,376.98/tonne = N251.38/kg
240,000


c)Debt/Equity ratio =
QUESTION 3

The above company sold its goods and made gross profit of 45%

Using the above data, determine the following financial ratio:

a. The revenue accruing to the company


b. The accounts receivable for 2 weeks
c. The variable costs
d. The break-even point

2011/2012 ALPHA SEMESTER EXAMINATION


COURSE TITLE: TECHNOLOGY MANAGEMENT
COURSE CODE: CHE 319
TIME DURATION: 3 HOURS
INSTRUCTION: ANSWER QUESTION 1 AND 3 OTHERS

Q. 1 (i) Explain the meaning of the following terms:

(a) Fixed Assets (b) Fixed Costs (c) Working Capital (d) Variable Costs

(ii) Hymore and Company Incorporated operates at 300 working days per
annum at a rate of 100 tonnes per day producing fine chemicals. The company
incurred the following expenses in the course of its manufacturing operations.

S/No. ITEM COST (,000)

1. Pre-Investment Costs 2,500


2. Land/Buildings 12,500
3. Machinery and Equipment 150,000
4. Office Machines/Fittings 1,200
5. Vehicles 17,500
6. Long Term Loan at 10% interest per annum 75,000
7. Revolving Loan at 25% interest per annum 10,000
8. Raw Materials per day 530
9. Salaries and Wages per month 1,500
10. Repairs and Maintenance Cost of the year 1,837
11. Utilities Cost for the year 3,500
12. General Supplies for the Year 24,500
13. Indirect Labour (Packers, Loaders, Transporters) 8,000
14. Sales/Marketing Commissions 7,500
15. Insurance at 2.5% of Fixed Capital
16. Workman's Compensation Insurance at 5% of Annual Salary
In addition, the company also maintains a budget to cover the following expected
expenses:

Raw Materials for 60 Production Days


Labour Costs for 60 Production Days
Manufacturing Expenses for 60 days
Receivables for 10 days

Finally the company sells its products at the rate of N14,500 per tonne.

Using the above data, determine the following:

(a) Working Capital point (b) Unit Cost (c) Revenue (d) Break Even Point (e)
Production Cost at 80% capacity

Q. 2(i) Distinguish between technology and Engineering

(ii) Gower asserts that Research and Development of incubated ideas, teamwork
strategy, resources and time management constitute the prime of Technology
Management. Do you agree

Q. 3(i) Write shortly on Decision flow chart in managing technology innovation

(ii) Ita, Bolaji and Company posted the following information in its financial
report at December 31, 2011.

ITEM COST (,000)

Corporate Income Tax 2,000

Accounts Receivable 3,000

Telephone Expense 7,000

Cost of Goods Sold 140,000

Salaries/Wages Expense 29,000

Total Current Assets 12,000

Advertising Expense 10,000

Inventory, End of Year 7,000

Net Other Income/ (Expense) 1,000

Beginning Balance, Retained Earnings 5,000

Dividends 2,000

Accounts Payable 6,000


Gross Profit 30%

Accumulated Depreciation 14,000

Buildings 50,000

Cash 2,000

Depreciation Expense 5,000

Total Operating Expenses 51,000

Common Stock 26,000

Purchases, Net 138,000

Inventory, Beginning of Year 9,000

Total Stockholders' Equity 35,000

Machinery & Equipment 12,000

Retained Earnings 9,000

Mortgage Payable 19,000

Revenue 200,000

ITA, BOLAJI AND COMPANY

PROFIT AND LOSS ACCOUNT AS AT DECEMBER 31, 2011

REVENUE..........................................................................................................N(,000)
100%

Cost of Goods Sold Calculation

Beginning Inventory....................................................................

Purchases....................................................................................

Goods Available for sale..............................................................

Ending Inventory..........................................................................

Cost of Goods for Sale..................................................................

Gross Profit...............................................................................................N 30%

Operating Expenses
*................................................................................

*................................................................................

*................................................................................

*................................................................................

TOTAL OPERATING EXPENSES...................................................N

Income From Operations..........................................................N

NET OTHER INCOME (Expense)................................................N

Net Income Before Tax..........................................................N

Corporate Income Tax Expense............................................N

NET INCOME (LOSS)..............................................................N

STATEMENT OF RETAINED EARNINGS

Beginning Balance, Retained Earnings.................................N

Net Income (Loss)...............................................................N

Dividends.............................................................................N

Ending Balance, Retained Profits........................................N

Using the above format, Present a profit and loss account report for the company as
at December 31, 2011.

Q. 4(i) What constitutes the stimulus, ways and means of becoming a world-class
company

(ii) Using the data in Question 3(ii), present the Balance Sheet of Ita, Bolaji and
Company using the format below:

BALANCE SHEET OF ITA, BOLAJI AND COMPANY AS AT DECEMBER 31, 2011

ASSETS N(,000)

Current Assets

*........................................................................................

*........................................................................................

*........................................................................................

Total Current Assets N...............


Fixed Assets

*........................................................................................

*........................................................................................

*........................................................................................

Net Fixed Assets N...................

Total Assets N...................

LIABILITIES AND STOCKBROKERS' EQUITY

Current Liabilities

*..........................................................................

*..........................................................................

Total Current Liabilities N....................

Long Term Debt N.....................

TOTAL LIABILITIES N.....................

Stockbrokers' equity

*...............................................................

*..............................................................

*..............................................................

TOTAL STOCKBROKERS' EQUITY


N.....................

Total Liabilities and Stockbrokers' equity N.....................

Q. 5(i) State the main factors that influence the choice of site for a
chemical/petrochemical company.

(ii) Explain the meaning of the term "financial ratio".

(iii) The Cash flow analysis of Fynebone, Maruwa & Igwe International is
attached in the next page.

Using the analysis, calculate the following finacial ratios

(a) Debt Equity ratio


(b) Acid test ratio

(c) Pay-back period if the initial cost of investment is N15,750,000,000.

Q. 6(i) What are the main features of a typical market survey in a feasibility study?

(ii) Empowerment in Technology Management generates efficiency in budding


companies. State the measures for achieving efficiency

(iii) Using the data in the cash flow analysis in Q.5 (iii), determine the following
viability ratios if the company invested N15,750,000,000 and made a profit of 75% in
its full year of normal operation;

(a) Return on Investment (ROI)

(b) Net present value (NPV)

(c) Internal Rate of Return (IRT)

ITEM YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5


N(,000) N(,000) N(,000) N(,000) N(,000)
CASH
INFLOW - 9,457,889:6 11,251,123:1 19,464,505: 27,981,635:
Brought 23,100,000: 2 2 68 28
Forward 00 34,650,000: 46,200,000: 46,200,000: 46,200,000:
Sales 8,000,000: 00 00 00 00
Turnover 00
Loans 3,883,445:3
Equity 1
TOTAL 34,983,445: 44,107,889: 57,451,123:1 64,664,505: 74.181,636:2
31 62 2 68 8
CASH
OUTFLO
W 5,778,750:0 5,475,000:0 5,171,250:00 4,867,500:0 4,563,750:0
Fixed 0 0 - 0 0
Asset Less 5,000,000: 3,000,000: 14,053,922: - -
Depreciati 00 00 09 14,053,922: 14,053,922:
on 5,898,722:1 9,976,322:1 8,000,000: 09 09
Loan 9 9 00 8,000,000: 10,000,000:
Refunds - 5,000,000: 00 00
Tax Paid 00
Dividend
Paid
CHANGE 10,761,445:3
IN 8,848,083:5 1 10,761,445:3 10,761,445:3
CURREN 0 9,405,444:3 1 1
T 1
ACCOUN
TS A/C
Raw
Materials
and
Operating
Costs

Cash 9,457,889:6 11,251,123:1 19,464,505: 27,981,635: 9,457,889:6


Surplus 2 2 68 28 2

2012/2013 ALPHA SEMESTER TEST 1


COURSE TITLE: TECHNOLOGY MANAGEMENT
COURSE CODE: CHE 319 TIME: 1hr

1. (a) Distinguish between the following terms:


i. Hypothesis and scientific law.
ii. Technology and engineering
(b) How is time management achieved in research and development?

2. Discuss the main tasks and ingredients in managing the inputs and results of a
new idea until it becomes a technology.

3. (i) What is empowerment?


(ii) State the measures normally used in research and development of new
technology to attain good results of empowerment.