10+ Interview Questions and Answers

Outstanding expenses are expenses that have been incurred but not yet paid.

• Outstanding expenses are recorded as a liability on the balance sheet.

• Journal entry for outstanding expenses: Debit Expense account, Credit Outstanding Expenses account.

• Example: Rent expense incurred but not yet paid will be recorded as outstanding expenses.

Prepaid expenses are expenses that have been paid in advance but have not yet been incurred.

• Prepaid expenses are considered assets on the balance sheet until they are used up or expire.

• Examples of prepaid expenses include prepaid rent, insurance premiums, and subscription services.

• Prepaid expenses are typically recorded as a current asset on the balance sheet and gradually expensed over time as they are used.

Bad debts are debts that are unlikely to be recovered by a company from its debtors.

• Bad debts are typically the result of customers who are unable or unwilling to pay their debts.

• They are recorded as an expense on the company's income statement.

• Companies may write off bad debts to remove them from their accounts receivable balance.

• Examples include customers declaring bankruptcy or simply refusing to pay their debts.

Stock market is a place where stocks of publicly traded companies are bought and sold. Derivative market deals with financial instruments derived from underlying assets.

• Stock market is a platform for buying and selling stocks of publicly traded companies

• Derivative market deals with financial instruments derived from underlying assets

• Depreciation is the decrease in the value of an asset over time due to wear and tear or obsolescence

• Amortization is the process of spreading the ...read more

Depression is a mental health disorder characterized by persistent feelings of sadness, hopelessness, and loss of interest in activities.

• Depression is a common mental health condition that can affect a person's thoughts, feelings, and behavior.

• Symptoms of depression may include feelings of sadness, irritability, fatigue, changes in appetite, and difficulty concentrating.

• Depression can be caused by a combination of genetic, biological, environmental, and psychological factors....read more

Journal entries for depreciation involve recording the decrease in value of an asset over time.

• Depreciation is recorded as an expense on the income statement and as an accumulated depreciation on the balance sheet.

• The journal entry for depreciation typically involves debiting the depreciation expense account and crediting the accumulated depreciation account.

• For example, if a company's equipment has a depreciation expense of $1,000, the journal entry would be: Debit Depreciat...read more

Accounting concepts and principles are the foundation of accounting practices.

• Accounting concepts are the basic assumptions and guidelines that govern the preparation of financial statements.

• Accounting principles are the rules and guidelines that companies must follow when reporting financial data.

• Examples of accounting concepts include the going concern concept, the accruals concept, and the consistency concept.

• Examples of accounting principles include the matching principle...read more

Prepaid expense is an advance payment made for goods or services that will be received in the future.

• Prepaid expenses are considered assets on the balance sheet.

• The journal entry for recording a prepaid expense involves debiting the Prepaid Expense account and crediting the Cash or Accounts Payable account.

• As the prepaid expense is consumed or utilized, it is gradually recognized as an expense through adjusting entries.

• Example: A company pays $1,200 in advance for a 12-month ...read more

The golden rules of accounting are basic principles that guide the recording of financial transactions.

• The first golden rule is the Debit/Credit rule, which states that for every debit entry, there must be a corresponding credit entry.

• The second golden rule is the Real/Personal/Nominal rule, which categorizes accounts into these three types based on their nature.

• The third golden rule is the Expense/Income rule, which states that expenses decrease equity while income increases...read more

The Golden rule is a principle of ethical conduct that states one should treat others as one would like others to treat oneself.

• The Golden rule is also known as the ethic of reciprocity.

• It is found in many religions and cultures around the world.

• The rule encourages empathy, compassion, and fairness in interpersonal relationships.

• Examples of the Golden rule include 'Do unto others as you would have them do unto you' and 'Treat others the way you want to be treated.'

Accrual entry is a type of accounting entry that records revenue or expenses before they are actually received or paid.

• Accrual entry is used to match revenue and expenses to the period in which they are earned or incurred, regardless of when the cash is received or paid.

• It involves recording an accrual (an amount that is owed or earned) and a corresponding offsetting entry.

• Accrual entries are typically made at the end of an accounting period to ensure accurate financial repor...read more