0 Accounting Interview Questions and Answers India at Manabadiresults.asia

Accounting Interview Questions and Answers India at Manabadiresults.asia | Accounting All Interview Questions and Answers at Manabadiresults.asia | Accounting Interview Tips | Accounting Interview Questions and Answers for Fresher's for MBA, PGDMA, CA, ICWA and other Arts Groups From your Interview, I Provide Basic Fundamentals Accounting Rules and Regulations also and First 20 Accounting Questions and Answers are given below .......

FATHER OF ACCOUNTANCY: LUKAA PASHIALL.

MEANING OF ACCOUNTING: According to American accounting association accounting is “The process of identifying , measuring and communicating information to permit judgment and decisions by the users of accounts”.

USER OF ACCOUNTS: Generally 2 types. 1. Internal management, 2. External users or Outsiders- Investors, Employees, Lenders, Customers, Gov.t  and other agencies, Public.

SUB-FIELDS OF ACCOUNTING:

ü Book-keeping: It covers procedural aspects of accounting work and embraces record keeping function.

ü Financial accounting: It covers the preparation and interpretation of financial statement.

ü Management accounting: It coverse the generation of accounting information for management decision.

ü Social responsibility accounting: It coverse the accounting of social costs in curred by the enterprise.

FUNDAMENTAL ACCONTING EQUATION:

                                  Assets = Capital + liabilities.

                                  Capital = Assets – liabilities.

Accounting elements: The elements directly related to the measurement of financial position i.e. ., for the preparation of balance sheet are assets, liabilities  and equity. The elements directly related to the measurments of performance in the profit and loss account are income and expenses.

Four steps(phases)of accounting process:

ü Journalisation of transations

ü Ledger positioning and balancing

ü Preparation of trail balance

ü Preparation of final accounting.

Book keeping: It is an activity, related to the recording of financial data, relating to business in an orderly manner. The main purpose of accounting for businesses is to as certain profit or loss of the accounting period.

Accounting: it is an activity of analysis and interpretation off the book keeping records.

Journal: Recording each transaction of the business.

Ledger: It is a book where similar transactions relating to a person or thing are recorded.

                   Types of ledger: Debtors ledger

                                             Creditor’s ledger

                                              General ledger.

Concepts: Concepts are necessary assumptions and conditions upon which accounting is based.

ü Business entity concept: In accounting, business is treated as separate entity from its owners. While recording the transaction in books, it should be noted that business and owners are separate entities. In the transaction of business, personal transactions of the owners should not be mixed.

For example:- Insurance premium of the owner etc………………

ü Going concern concept: Accounts are recorded and assumed that the business will continue for a long time. It is useful for assessment of goodwill.

ü Consistency concept: It means that same accounting policies are followed from one period to another.

ü Accrual concept: It means that financial statements are prepared on mercantile system only.

Types of Accounts: Basically accounts are three types

ü Personal Account: Accounts which show transactions with persons are called personal account. It includes accounts in the name of persons, firms, companies.

                         In this: Debit the receiver

                                      Credit the giver.

            For example:- Marsh a/c, Karuna&co a/c, Maharnika a/c etc…..

ü Real Account: Accounts relating to assets is known as real accounts. A separate account is maintained for each asset owned by the business.

                        In this: Debit what comes in

                                    Credit what goes out.

          For example:- Cash a/c, Machinary a/c etc……

ü Nominal Account: Accounts relating to expenses, losses, incomes and gains are known as nominal account.

                        In this: Debit expenses and loses

                                    Credit incomes and gains.

        For example:- Wages a/c, Salaries a/c, commission recived a/c etc…..

Accounting convention: The term convention denotes customs or traditions which guide the accountant while preparing the accounting statements.

ü Convention of consistency: Accounting rules, practices should not change from one year to another.

       For example:- If depreciation on fixed assets is provided on straight line method. It should be done year after year.

ü Convention of full disclosure: All accounting statements should be honestly prepared and full disclosure of all important information should be made. All information which is important to assets, creditors, investors should be disclosued in account statements.

Trail balance: A trail balance is a list of all the balances standing on the ledger accounts and cash book of a concern at any give data. The purpose of the trail  balance is to establish accuracy of the books of accounts.

Trading Account: The first step of the preparation of final account is the preparation of trading account. It is prepared to know the gross margin or trading results of the business.

Profit and Loss a/c: It is prepared to know the net profit. The expenditure recording in this a/c is indirect nature.

Balance sheet: It is a statement prepared with a view to measure the exact financial position of the firm or business on a fixed date.

Outstanding Expenses: These expenses are related to the current year but they are not yet paid before the last date of the financial year.

Prepaid Expenses: There are several items of expenses which are paid in advance in the normal course of business operations.

Income and expenses A/c:In this only the current period incomes and expenditures ara taken into consideration while preparing this a/c.

Royalty:It is a periodical payment based on the output or sales for use of a certain asset.

           For example:- Mines, Copyrights, Patent.

Hire purchase: It is an agreement b/w two parties. The buyer acquires possession of the goods immediately and agrees to pay the total hire purchase price in instalments.

          Hire purchase price = Cash price + Interest.

Lease: A contractual arrangement whereby the lesser grants the lessee the right to use an asset in return for periodic lease rental payments.

Double entry: Every transaction consists of two aspects

1.     The receiving aspect

2.     The giving aspect

The recording of two aspect effort of each transaction is called “ double entry”.

The principle of double entry is, for every debit there must be an equal and a corresponding credit and vice versa.

BRS: When the cash book and the passbook are compared, sometimes we found that the balances are not matching. BRS is prepared to explain these differences.

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