Leixir Resources Interview Questions and Answers

Answers to questions related to finance and accounting.

• Interest received is shown in the operating activities section as inflow while interest paid is shown in the financing activities section as outflow.

• Journal entry for machine purchased by selling stocks: Debit Machinery account and Credit Stock account.

• NPV and IRR are both used to evaluate the profitability of an investment project. NPV calculates the present value of future cash flows while IRR calculates the rate of ret...read more

Basic shares refer to the total number of shares outstanding, while diluted shares include all potential shares that could be issued.

• Basic shares are the total number of shares outstanding, including common and preferred shares.

• Diluted shares include all potential shares that could be issued, such as stock options, convertible bonds, and warrants.

• Diluted shares are used to calculate earnings per share (EPS) to give a more accurate picture of a company's financial health.

• If a ...read more

Treatment of dividend in Cash flow statement and journal entry for machine purchased by issuing shares.

• Dividends paid are deducted from net income in the cash flow statement under financing activities

• Dividends received are added to net income in the cash flow statement under investing activities

• Journal entry for machine purchased by issuing shares: Debit Machinery, Credit Share Capital

Minority interest refers to the ownership stake in a company held by individuals or entities other than the controlling shareholders.

• Minority interest represents the portion of a subsidiary's equity that is not owned by the parent company.

• It is also known as non-controlling interest or outside equity.

• Minority interest is reported on the balance sheet as a separate line item.

• It reflects the share of profits or losses attributable to minority shareholders.

• It is calculated by mu...read more

Revolving credit facilities are lines of credit that allow borrowers to draw funds as needed up to a predetermined limit.

• Revolving credit facilities are flexible and can be used for various purposes such as working capital, inventory financing, and short-term cash flow needs.

• Interest is charged only on the amount borrowed and not on the entire credit limit.

• Repayments can be made at any time, and once repaid, the credit line is available for use again.

• Examples of revolving cre...read more