Accounting Interview Questions
Categories: Accountancy
How to adjust entries into account?
Entries are often adjusted under consideration by sorting entries into five categories:
Accrued expenses: Expenses have been incurred, but the vendor’s invoices are not generated or processed yet
Increased revenues: Returns have passed collected, without the selling statements are no made or prepared yet.
Charged means: Payment did take in the approach of having been paid or earned.
Charged fees: Cash was given for a planned time.
Reduction rate: An asset acquired in one time must be allotted to expense in all of the accounting terms of the asset’s valuable time.
Explain deferred assets with example?
A partial asset transfers to a delayed entry or an assessed price. An example of a deferred charge is bond costs. These costs involve all of the fees or charges that an organization incurs to register and issue bonds. These fees are paid in a near time when the bonds are issued, but it will not be expensed at that time.
What is Bank Reconciliation?
A bank reconciliation may be a process done by a corporation. It ensures that the company’s records are correct and that the bank’s records are also correct. These records are often register, record, a ledger account, etc.
What is “deposit in transit”?
Ans: A deposit in transit is a check or cash that has been received and recorded by an entity. It should not yet be entered in the records of the bank where the funds are deposited.
Explain the difference between working capital and available cash/bank balance?
Working capital is the day-to-day funds’ requirement for any business. Cash and bank balance may be a part of the entire capital availability of any organization. Working capital is much border than just cash and bank balances. Current assets and liabilities also make up for the working capital of the business.
Assume you are given financial statements of three different competitors. You are required to ascertain which of these three is in the best financial shape. What are the two main parameters that you will use to judge?
a) Correlation between revenue and profit of the organization – a corporation with a better revenue isn’t necessarily doing well.
b) Debt-equity ratio – A proper balance needs to be maintained between the two – debt and equity. Only debt means high-interest costs. Only equity means the corporate isn’t leveraging the opportunities available within the marketplace for lower interest rates.
You mentioned that MS Excel will be your best friend, give us three instances in which Excel will make your life easier?
Various reports can be extracted from the ERP. However, many times reports required in specific formats and this may not be possible in the ERP. This is where excel comes into the picture. Data can be sorted, filtered, redundant data fields can be deleted and the data can then be presented in the customized format.
Suggest improving the working capital flow of the company?
According to my, stock-in-hand are often the key to improving the capital of the corporate. Out of all the components of working capital, the stock is controllable by us. We can pressurize our debtors to pay us instantly but we cannot have direct control over them because they are separate legal entities and in the end, they are the ones who give us business.
What does the cash flow statement about the company?
It is very interesting to correlate the cash flow statement and the profit and loss statement of the company. What i’m trying to mention is, high revenue doesn’t mean that the corporate features a high availability of money. At an equivalent, if the corporate has excess liquid cash, it doesn’t mean that the corporate has earned a profit.