Accounting Interview Questions and Answers
Question - 61 : - List the three basic elements of cost
Answer - 61 : -
The three basic elements of cost are 1) Material, 2) Labour, and 3) Expenses.
Question - 62 : - What is the main difference between accumulated depreciation and depreciation expense?
Answer - 62 : -
The difference between accumulated depreciation and depreciation expense is that:
Accumulated depreciation is the total amount of depreciation that has been taken on a company’s assets up to the date of the balance sheet.
Depreciation expense is the amount of depreciation that is reported on the income statement.
Question - 63 : - List out some of the examples for liability accounts?
Answer - 63 : -
Some of the examples of liability accounts are:
- Accounts payable
- Accrued expenses
- Short-term loans payable
- Unearned or deferred revenues
- Installment loans payable
- Current portion of long-term debt
- Mortgage loans payable
Question - 64 : - How to adjust entries into account?
Answer - 64 : -
Entries can be adjusted into account by sorting entries into five categories:
- Accrued expenses: Expenses have been incurred, but the vendor’s invoices are not generated or processed yet
- Accrued revenues: Revenues have been earned, but the sales invoices are not generated or processed yet.
- Deferred revenues: Money was received in advance of having been paid or earned.
- Deferred expenses: Money was paid for a future expense.
- Depreciation expense: An asset purchased in one period must be allocated to expense in each of the accounting periods of the asset’s useful life.
Question - 65 : - Explain deferred asset with example
Answer - 65 : -
A deferred asset refers to a deferred debit or a deferred charge. An example of a deferred charge is bond issue 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.
Question - 66 : - What is Bank Reconciliation?
Answer - 66 : -
A bank reconciliation is a process done by a company. It ensures that the company’s records are correct and that the bank’s records are also correct. These records can be check register, balance sheet, a general ledger account, etc.
Question - 67 : - What is “deposit in transit”?
Answer - 67 : -
A deposit in transit is a check or cash that has been received and recorded by an entity. It should not yet been entered in the records of the bank where the funds are deposited.
Question - 68 : - What is a journal?
Answer - 68 : -
Journal is a book that is maintained regularly for recording various financial entries.
Question - 69 : - Deferred taxation is a part of which equity?
Answer - 69 : -
Deferred taxation is a part of the owner’s equity.
Question - 70 : - List out some of the accrued expenses and the accounts to record them
Answer - 70 : -
Accrued expenses and the accounts are:
Wage accrual is entered with a credit to the “wages payable account.”
Interest accrual is entered with a credit to the “interest payable account.”
Payroll tax accrual is entered with a credit to the “payroll taxes payable account.”