OrangeIQ Accounting Staff Interview Questions, Process, and Tips

When an asset is sold with profit, a journal entry is made to record the transaction.

• Debit the Cash account for the amount received from the sale

• Credit the Asset account for the original cost of the asset

• Credit the Gain on Sale of Asset account for the profit made

• Example: If an asset was sold for $10,000 with a cost of $8,000, the journal entry would be: Cash $10,000, Asset $8,000, Gain on Sale of Asset $2,000

TDS stands for Tax Deducted at Source. Journal entry for TDS involves debiting TDS payable and crediting the respective expense account.

• TDS is a tax deducted by the payer at the time of making payment.

• Journal entry for TDS involves debiting TDS payable account.

• Crediting the respective expense account for which TDS is deducted.

• Example: If TDS is deducted on salary payment, the journal entry would be: Debit TDS Payable,

Negative working capital occurs when current liabilities exceed current assets.

• Occurs when a company's current liabilities exceed its current assets

• Indicates potential financial trouble or inefficiency in managing short-term obligations

• Can lead to difficulties in paying off debts or funding operations

• Example: Company A has $100,000 in current assets and $150,000 in current liabilities, resulting in negative working cap

Trial balance is a list of all general ledger accounts with their balances, while balance sheet is a financial statement that shows assets, liabilities, and equity at a specific point in time.

• Trial balance is an internal document used to ensure the total debits equal the total credits in the general ledger.

• Balance sheet is a financial statement that provides a snapshot of a company's financial position at a specific po...read more