Latest Account Executive Interview Questions Part – 2
Explain What Are Bills Receivable?
Bills Receivable , in merchant accounts, are all promissory notes, bills of exchange, bonds, and other evidences or securities which a merchant or trader holds, and which are payable to him.
Tell Me What Is Depreciation And How Many Types Are There. Please Give Details?
Depreciation and its types: Depreciation means reducing/lowering value of an asset because of its use. Like machines/vehicles gets rusty/slow because of consistent use.
Tell Me What Is Computerized Accounting?
Accounting is the method in which financial information is gathered, processed, and summarized into financial statements and reports.
The purpose of accounting is to provide information used in decision-making. Accounting may be viewed as a system (a process) that converts data into useful information.
Information processes include:
► Recording
► Maintaining
► Reporting
Every business has numerous processes. Some are simple, others complex and cumbersome. However, as the business grows, acquires new customers, enters new markets, and keeps pace with constant changes in statutory regulations… the company will need to maintain highly accurate and up-to-date accounting, inventory, and statutory records.
This is where a computerized accounting helps simplify, integrate, and streamline all the business processes, cost-effectively and easily.
Explain What Is Retail Banking?
Retail banking refers to the banking done with the retail client (e.g. the normal people) rather than business or organizational customers.
Explain What Is Marginal Cost?
The marginal cost of an additional unit of output is the cost of the additional inputs needed to produce that output. More formally, the marginal cost is the derivative of total production costs with respect to the level of output. Marginal cost and average cost can differ greatly.
For example:
suppose it costs $1000 to produce 100 units and $1020 to produce 101 units. The average cost per unit is $10, but the marginal cost of the 101st unit is $20The Econ Model applications Perfect Competition and Monopoly emphasize the roles of average cost and marginal cost curves.
The short movie Derive a Supply Curve (40 seconds) shows an excerpt from the Perfect Competition presentation that derives a supply curve from profit maximizing behavior and a marginal cost curve.
Tell Me What Is Executive Accounting?
Executive Accounting is designed for service type businesses that require a sophisticated accounting system, yet simple to use accounting system.
Executive Accounting contains many advanced features such as three styles of invoicing (service, distribution and recurrent), multi-currency capabilities, multiple bank account capabilities and other powerful features. Executive is a single-user system that can be upgraded to an unlimited number of users.
Tell Us How To Prepare Finalization Accounts?
First, of all post all the journals in the ledger and then post in the trial balance and from that prepare trading account and manufacturing account (if necessary) and profit and loss account.
And then prepare profit and loss adjustment account and with the help of the trial balance prepare balance sheet and also show the profit under reserves after deducting the previous year losses and show contingencies (if any) in the notes to accounts.
Explain What Is The Basic Accounting Equation?
Accounting Equation- Accounting rotates around three basic terms. These terms are assets, liabilities and capital. the true relationship between these terms is represented as Acconting Equations ie..
Assets= liabilities+ Capital.
Explain Why Are Accounting Standards Necessary?
Accounting standards are necessary to promote high quality financial reporting. The fundamental role of accounting is to communicate economic information about businesses and other organization to various stakeholders including government, investors, shareholders, suppliers, lenders, customers, and the public.
These stakeholders use such information to take decisions and to assess the stewardship of people appointed to manage such organizations. If this information were not of a high quality standard, then the stakeholders would be unable to take effective decisions that will benefit them.
For example, if a financial report were manipulated to show higher profits, investors would hold on to their shares with the belief that the company is doing well.
Accounting standards came to be developed from the mid sixties onwards to promote the integrity of the accounting profession by way of ensuring uniformity in the way accountants report transactions in their books and in their preparation of the final accounts of businesses.
This is largely aimed at boosting the confidence of stakeholders, particularly shareholders and potential investors in the accounting profession.
Good and useful information should have the essential characteristics of understandability, comparability, relevance, and reliability in order to play its role effectively.
Accounting standards serve to promote the understandability, comparability, relevance, and reliability of financial reports.
Tell Me How Many Accounting Standards Are Currently Published?
Accounting Standards are formulated with a view to harmonise different accounting policies and practices in use in a country.
The objective of Accounting Standards is, therefore, to reduce the accounting alternatives in the preparation of financial statements within the bounds of rationality, there by ensuring comparability of financial statements of different enterprises with a view to provide meaningful information to various users of financial statements to enable them to make informed economic decisions.ICAI issued a total of 33 accounting standards.
Explain What Are The Disadvantages Of Back-flush Accounting?
One of the main disadvantages of the system is that it only works under some quite strict requirements. If these are not met, the system will become unbalanced and may be quite unusable, or a nightmare to maintain.
Standard costs must be reliably estimated and variances kept to a minimum. The premise of the system is that a sale triggers the manufacturing process, therefore buildup of work in progress or finished goods needs to be avoided Another drawback is that detailed information for management purposes may not be available where needed, and the production control therefore needs to be all the stronger.
The cost accounts used in back-flush accounting may be more difficult to reconcile to financial accounts needed for reporting.
Tell Me What Is Bank Reconciliation Statement?
A Bank reconciliation statements are prepared if balance of bank account as shown in cashbook differs from balance as shown in passbook. This statement shows the reasons or transactions because of which balances as shown in cashbook and passbook are not tallying with each other.
What Is Service Tax & Excise? How Will It Be Charged?
Service Tax is a Indirect Tax which is levied on Service. The Service receiver will pay to the service provider.
Ex:
Servicing a Vehicle, Delivering goods, outsourcing agencies. etc.
Excise Duty is also a form of Indirect Tax but this is imposed on Goods or manufacturing Items.
Ex:
Steel, Cement, dress Materials, etc
Explain What Are The Fictitious Assets?
These are like intangible assets, which cannot be seen or touched. Actually, these are not assets but some expenditure, which cannot turn to profit and loss account of a particular period that is why these items are shown on assets side of balance sheet to be written off to P&L account in reasonable years.
Explain What Is A Difference Between Public And Private Accounting?
Public accounting includes any accounting work that a company performs for another company. Examples would be audits, tax compliance, consulting, etc. The “Big 4” (KPMG, Deloitte & Touch?Price Waterhouse Coopers, and Ernst & Young) are the dominant firms that provide public accounting services.
Private accounting is accounting work that is done for your own company. Every company has some form of an internal accounting department and those employees would be considered private accountants.
Tell Me Where Should Tds Received Should Show In Balance Sheet?
TDS either can be deducted by other on payment/income we receive or we deduct on paymnet/expenditure we make to others.
In first instance TDS will be shown in Assets side in balance sheets under current assets and in second instance TDS will be shown in balance sheet under current liability.
TDS is part of advance tax for the deductee while for deductor its current liability.
Do You Know What Does The Abbreviation Dr Mean In Accounting?
‘Dr’ means Debere in Latin stands for ‘what comes in’ or in simple words whatever assets the business owns or the expenses it has to pay comes under debit.
While ‘cr’ means credere in Latin means ‘what goes out’, in simple words whatever liabilities business owns, or the income it earned during the year comes under credit.
Tell Me What Do You Mean By Material Facts In Accounting?
Material fact in accounting is that we make entry of every material thing like stationary etc but that should be in terms of money.
Tell Me Your Views On Creative Accounting?
All accounting should be creative accounting. It’s not just a matter of crunching numbers. It’s about making sure those numbers work as best they can. A good accountant isn’t afraid to be creative. He or she comes up with innovative solutions to make the numbers work.
What Is The Difference Between Perpetual & Periodic Inventory Systems?
In perpetual inventory system, the inventory account is adjusted continually throughout the accounting period.
Whereas in the Periodic Inventory System: – Recording inventory transactions periodically than recording them continually.
Explain What Is The Dual Aspect Concept?
Dual aspect concept:
Each transaction has two sides. Example: when you buy a shirt, then shirt comes to you while cash leaves you similarly if you sell the same shirt to anyone then cash comes to you while shirt leaves you. Recording both aspects of coming and going is called dual aspect concept.