Young Concepts Interview Questions and Answers

Bank Reconciliation Statement is a document that matches the bank balance with the company's balance.

• It is used to identify any discrepancies between the two balances.

• It includes items such as outstanding checks, deposits in transit, and bank fees.

• A practical example would be comparing the company's records of deposits and withdrawals with the bank statement to ensure accuracy.

• Any differences found are then investigated and resolved.

• The end result is a reconciled balance that...read more

When an asset increases, it must be debited.

• Debit increases assets and credit decreases assets.

• Assets include cash, accounts receivable, inventory, property, and equipment.

• For example, if a company purchases a new machine, the asset account for machinery will be debited to increase it.

• This is based on the accounting equation: Assets = Liabilities + Equity.

Equity decreases must be debited.

• Equity is a credit balance account, so when it decreases, it must be debited to reduce the credit balance.

• Debiting equity reduces the owner's or shareholder's equity in the business.

• Examples of equity decreasing transactions include paying dividends, recording losses, or issuing treasury stock.

Operating expenses are costs incurred in running a business, while COGS are expenses directly related to producing goods or services.

• Operating expenses include salaries, rent, utilities, and marketing expenses.

• COGS include the cost of raw materials, labor, and manufacturing overhead.

• Operating expenses are recorded on the income statement, while COGS is deducted from revenue to calculate gross profit.

• Operating expenses are usually fixed costs, while COGS can vary with producti...read more

Petty cash book is used for small cash transactions while cash book is used for all cash transactions.

• Petty cash book is used for small cash transactions like buying office supplies or paying for small expenses.

• Cash book is used for all cash transactions including receipts and payments.

• Petty cash book is maintained by a petty cashier while cash book is maintained by the main cashier.

• Petty cash book is usually a single column book while cash book can be single or double column...read more