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Friday, June 14, 2019

60 Top Accounting Interview Questions and Answers{Updated}

Accounting Interview Questions and Answers for experienced PDF, Read commonly asked Accounting Job Interview Questions with Answer PDF for Freshers.

Read Accounting Interview Questions and Answers

Definition of Accounting?
The art of recording, classifying and summarizing in a significant manner and in terms of money, transactions, and events which are, in part at least of a financial character and interpreting the results thereof.

Why did you select accounting as your profession?
Well, I was quite good at accounting throughout but in my masters, when I got distinction I decided to adopt this field as a profession.

Do you have any professional experience in this field?
Yes, I have worked as an accountant at two different places.

Did you use accounting applications at your previous companies or prefer working manually?
Yes, I have used Advanced Business Solutions and AME Accounting Software in my previous jobs.

Can you name any other accounting application?
Yes, I am familiar with CGram Software, Financial Force, Microsoft Accounting Professional, Microsoft Dynamics AX and Microsoft Small Business Financials.

Which accounting application you prefer most and why?
I think all are good though but Microsoft Accounting Professional is best because it offers reliable and fast processing of accounting transactions that saves time and increases proficiency.

What is the abbreviation for the accounting terms debit and credit?
The debit abbreviation is “dr” and credit abbreviation is “cr”.

How many types of business transactions are there in accounting?
There are two types of transactions in accounting i.e. revenue and capital.

What is the balance sheet?
It is a statement that states all the liabilities and assets of the company at a certain point.

Have you ever heard about TDS, what it is?
Yes, TDS abbreviates Tax Deduction at Source.

In the balance sheet, where do you show TDS?
It is shown on the assets section, right after the head current asset.

Do you have any idea about Service Tax or Excise?
It is a kind of hidden tax that is included in the service provided by the service provider and paid by the service receiver.

Do you think there is any difference between inactive and dormant accounts?
Yes, both are different terms in accounting. Inactive accounts mean that accounts have been closed and will not be used in the future as well. While dormant accounts are those that are not functional today but may be used in the future.

What is tally accounting?
It is the software used for accounting in small business and shops for managing routine accounting transactions.

How can you define departmental accounting?
It is a type of accounting in which a separate account is created for departments. It is managed separately as well as shown independently in the balance sheet.

Define fictitious assets?
These are the assets that cannot be shown or touch. Fictitious assets can only be felt such as goodwill, rights, etc.

By saying, perpetual or periodic inventory system; what do we mean?
In the first one i.e. the perpetual inventory system, the accounts are adjusted on a continual basis. In the periodic inventory system, the accounts are adjusted periodically.

In accounting, how do you define the premises?
Premises refer to fixed assets that are shown in the balance sheet.

In accounting, VAT abbreviates what?
VAT means Value Added Tax.

Do you possess any knowledge about accounting standards?
Yes, as per my knowledge there are total 33 accounting standards published so far by ICAI. The purpose of these standards is to implement the same policies and practices in any country.

What is ICAI?
It is the abbreviation of the Institute of Chartered Accountants in India.

How can you explain the basic accounting equation?
We know that accounting is all about assets, liabilities, and capital. Therefore, the accounting equation is:
Assets = Liabilities + Owners Equity.

Define Executive accounting?
It is a type of accounting that is specifically designed for the business that offers services to users.

Define Public accounting?
Public accounting offers audits and CPAs to review company financial records to ensure accountability. It is for the general public.

What is a CPA?
CPA stands for Certified Public Accountant. To become a CPA, one should have to do many other qualifications as well. It is a qualification with a 150 hour requirement; it means that one should complete 150 credit hours at an accredited university.

What do you think is a bank reconciliation statement?
A reconciliation statement is prepared when the passbook balance differs from the cash book balance.

Differentiate Public and Private Accounting?
Public accounting is a type of accounting that is done by one company for another company. Private accounting is done for your own company.

What is project implementation?
Project implementation involves six steps in total such as:
• Identify Need
• Generate and Screen Ideas
• Conduct Feasible Study
• Develop the Project
• Implement the Project
• Control the Project

Do you think Accounting Standards are mandatory and why?
Yes, I do believe that accounting standards play a very important role to prepare good quality and accurate financial reports. It ensures reliability and relevance in financial reports.

Can you name different branches of accounting?
There are three branches of accounting named “Financial Accounting”, “Management Accounting” and “Cost Accounting”.

Differentiate Accounting and Auditing?
Accounting is all about recording daily business activities while auditing is the checking that whether all these events have been noted down correctly or not.

Define dual aspect term in accounting?
As the name implies, the dual aspect concept states that every transaction has two sides. For example, when you buy something, you give the cash and get the thing. Similarly, when you sell something, you lose the thing and gets the money. So this getting and losing are basically two aspects of every transaction.

What do we mean by purchase return in accounting?
It is the term introduced in the records for every defective or unsatisfactory good returned back to its supplier.

Define the term material facts in accounting?
Material facts are the bills or any document that becomes the base of every account book. It means that all those documents, on which account book is prepared, are called material facts.

Have you ever prepared MIS reports and what are these?
Yes, I have prepared a few MIS reports during my previous jobs. MIS reports are created to identify the efficiency of any department of a company.

Define the company’s payable cycle?
It is the time required by the company to pay all its account payables.

Define retail banking?
It is a type of banking that involves a retail client. These clients are normal people and not any organizational customers.

How much mathematics knowledge is necessary or required in accounting?
Not much knowledge but the basic mathematical background is required in accounting for operations like addition, subtraction, multiplication, and division.

Define bills receivable?
All types of exchange bills, bonds and other securities owned by a merchant that is payable to him are said as bills receivable.

Define depreciation and its types?
By depreciation, we mean that the value of an asset is decreasing as it is in use. It has two types such as “Straight Line Method” and “Written Down Value Method”.

Differentiate between consignor and consignee?
Consigner is the owner of the goods or you can say he is the person who delivers the goods to the consignee. The consignee is the person who receives the goods.

Define balancing in accounting?
Balancing means to equate both sides of the T-account i.e. the debit and credit sides of a T-account must be equal/balanced.

How much statistics knowledge is necessary or required in accounting?
You must be very good at statistics if you want to do well in accounting. Otherwise, with minimum knowledge, you cannot manage your day to day transactions effectively in accounting.

Define Scrap value in accounting?
It is the residual value of an asset. The residual value is the value that any asset holds after its estimated lifetime.

Define the Marginal Cost?
Suppose you have to produce an additional unit of output. The estimated cost of additional inputs to produce that output is actually the marginal cost.

Define Partitioning in accounting?
It is a kind of groups made on the basis of the same responses by a system.

Differentiate between provision and reserve?
Provisions are the liabilities or the anticipated items such as depreciation. You can say provisions are expenses. Reserves are the profits of any company and a part of that profit is placed back to the business to keep it sustainable in tough times of a company.

Define Offset accounting?
Offset accounting is one that decreases the net amount of another account to create a net balance.

Define overhead in terms of accounting?
It is the indirect expenditure of a company such as salaries, rent dues, etc.

Define trade bills?
We know that all types of transactions need to be documented. The trade bills are the documents, generated against each transaction.

Define fair value accounting?
As per fair value accounting, a company has to show the value of all of its assets in terms of price on the balance sheet on which that asset can be sold.

What is the difference between Cost Accounting and Financial Accounting?
Financial accounting encompasses all account presented on the face of the financial statement, its presentation, recognition, measurement, and disclosures. Whereas cost accounting is only focused on the cost of inventory.

Explain Accounting 101?
Typically, it involves the theory of credit and debt, balance sheets, income statements, controlling accounting accounts, subsidiary ledgers, worksheets, depreciation methods, and financial accounting theory.

What are the basic assumptions in accounting?
Economic Entity Assumption
Going Concern Assumption
Monetary Unit
Periodicity Assumption

What is a customer account?
Debtors account and bills receivable account are theoretically the same. Both are called as receivables. When we sold goods to debtors account is debited. If we receive a bill from that debtor, we open bills receivable account by closing that debtor account. Thus, bills receivable account is nothing but debtor account. If the bill is dishonored on the due date, we again debit the debtor account in our books. For information and accounting purpose, we use both debtor account and bills receivable account.

What is the Provision? What is the Entry for Provision?
The provision means liabilities it means payable account A it's a very useful for controlling payable accounts like telephone charges, ESIC accounts, EPF accounts, A EPF payable accounts Dr to EPF accounts ESIC payable accounts Dr to ESIC account.
Provision Account is Prepared for fixed future liabilities. In every organisation, there is a limited source of capital and can not able to pay hues certain. so every organization transfers some amount to provision account. which any business concern use any time when they relies on. exp. depreciation Account, Reserve & surplus Account

Why are accounting firms needed?
Accounting firms come in handy for many reasons. Some of the smaller ones: Businesses will use them to calculate payroll and the accounting firm will calculate the amount of taxes taken out.

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