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PwC Tax Associate Interview Questions and Answers

Updated 11 Dec 2024

Q1. What is the accounting procedure for Bad debts

Ans.

Bad debts are recorded as an expense in the income statement and as a reduction in accounts receivable in the balance sheet.

  • Bad debts are debts that are unlikely to be collected from customers.

  • The accounting procedure for bad debts involves estimating the amount of bad debts and recording them as an expense in the income statement.

  • The allowance method is commonly used to estimate bad debts.

  • Under the allowance method, a percentage of accounts receivable is estimated to be unco...read more

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Q2. What are three golden rules of accounting

Ans.

The three golden rules of accounting are the rules of debit and credit, which are: 1. Debit the receiver, credit the giver 2. Debit what comes in, credit what goes out 3. Debit expenses and losses, credit income and gains

  • Debit the receiver, credit the giver - for example, when a company receives cash from a customer, the cash account is debited and the accounts receivable account is credited

  • Debit what comes in, credit what goes out - for example, when a company purchases inve...read more

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Q3. What is deferred revenue?

Ans.

Deferred revenue is income received by a company in advance of earning it, resulting in a liability on the balance sheet.

  • Deferred revenue represents a liability for the company until the goods or services are delivered to the customer.

  • It is common in subscription-based businesses where customers pay upfront for services that will be provided over time.

  • Once the revenue is earned, it is recognized on the income statement.

  • Examples include magazine subscriptions, software license...read more

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Q4. what is accrual concept

Ans.

Accrual concept is a principle of recognizing revenue and expenses when they are incurred, regardless of when cash is exchanged.

  • Revenue and expenses are recorded when they are earned or incurred, not when cash is received or paid.

  • This concept ensures that financial statements accurately reflect the financial position of a company.

  • For example, if a company provides services in December but doesn't receive payment until January, the revenue is still recognized in December under...read more

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Q5. what is quick ratio

Ans.

The quick ratio is a financial metric used to measure a company's ability to meet its short-term obligations with its most liquid assets.

  • Quick ratio is calculated by dividing quick assets (cash, marketable securities, accounts receivable) by current liabilities.

  • A quick ratio of 1 or higher indicates that a company has enough liquid assets to cover its short-term liabilities.

  • A quick ratio below 1 may suggest that a company may struggle to meet its short-term obligations.

  • Quick ...read more

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Q6. Basis of depreciation

Ans.

Depreciation is the allocation of the cost of an asset over its useful life for tax and accounting purposes.

  • Depreciation is used to spread out the cost of an asset over its useful life

  • Different methods of depreciation include straight-line, double declining balance, and units of production

  • Depreciation expense is recorded on the income statement and accumulated depreciation is shown on the balance sheet

  • Depreciation is a non-cash expense that reduces the value of an asset over ...read more

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Q7. golden rules of accounting

Ans.

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

  • The golden rule of accounting is that for every debit entry, there must be an equal credit entry.

  • There are three types of accounts: real, personal, and nominal. The golden rules differ for each type of account.

  • For real accounts, the golden rule is: Debit what comes in, credit what goes out.

  • For personal accounts, the golden rule is: Debit the receiver, credit the give...read more

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Q8. Golden rules of accounting

Ans.

Golden rules of accounting are basic principles that guide the process of recording financial transactions.

  • There are three golden rules of accounting: Debit what comes in, Credit what goes out, Debit the receiver, Credit the giver, Debit expenses and losses, Credit income and gains.

  • For example, when a company receives cash from a customer, the cash account is debited (increased) and the accounts receivable account is credited (decreased).

  • Another example is when a company pays...read more

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Interview Process at PwC Tax Associate

based on 20 interviews
3 Interview rounds
Resume Shortlist Round
Aptitude Test Round
One-on-one Round
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