BDO India LLP Interview Questions, Process, and Tips

AR stands for Accounts Receivable. Journal entries related to it are transactions that record the amount owed to a company by its customers.

• AR is a type of asset account that represents money owed to a company by its customers

• Journal entries related to AR include recording sales on credit, receiving payments from customers, and writing off bad debts

• Example: Recording a sale on credit would involve debiting AR and credi...read more

Journal entry for services worth 1,00,000 with 10% TDS deducted

• Debit the TDS account with 10,000

• Credit the vendor account with 90,000

• Credit the TDS payable account with 10,000

If a company becomes insolvent, the entry should be recorded as a loss in the financial statements.

• Insolvency occurs when a company is unable to pay its debts and liabilities.

• The entry to record insolvency typically involves recognizing a loss on the balance sheet.

• The specific accounts affected will depend on the nature of the insolvency and the company's accounting policies.

• For example, if a company becomes insolvent ...read more

If bad debt is recovered, the entry should be a reversal of the original bad debt write-off entry.

• Create a journal entry to reverse the original bad debt write-off entry

• Debit the bad debt recovery account for the amount recovered

• Credit the accounts receivable account for the same amount

• If any interest or fees were charged on the bad debt, those should be credited to the income account

• If the bad debt was previously writ...read more

Passive Foreign Investment Company (PFIC) is a foreign corporation where at least 75% of its gross income is passive or at least 50% of its assets produce passive income.

• PFIC status can have significant tax implications for U.S. taxpayers.

• Taxpayers must report PFIC investments on Form 8621.

• PFIC rules are complex and may require specialized tax advice.

• Examples of PFICs include certain foreign mutual funds and holding co

Form 5471 is a tax form used by certain U.S. persons who are shareholders in certain foreign corporations.

• Required to be filed by U.S. persons who are officers, directors, or shareholders in certain foreign corporations

• Provides information on the foreign corporation's financial activities and ownership structure

• Helps the IRS prevent tax evasion through controlled foreign corporations

• Different filing requirements based ...read more

Best practices for handling complex accounting situations involve thorough research, clear communication, and attention to detail.

• Thoroughly research accounting standards and regulations related to the situation

• Communicate with relevant stakeholders to gather necessary information and ensure understanding

• Document all steps taken and decisions made to maintain a clear audit trail

• Seek guidance from experts or consultants...read more