Yuvraj Chemical Interview Questions and Answers

Explanation of journal entries for Prepaid, Accruals, Depreciation, Provision for Bad debts, DTA, and DTL.

• Prepaid expenses are initially recorded as assets and then expensed over time as they are used up.

• Accruals are expenses incurred but not yet paid or revenue earned but not yet received.

• Depreciation is the allocation of the cost of a fixed asset over its useful life, with accumulated depreciation representing the total depreciation expense to date.

• Provision for bad debts i...read more

Preparation of balance sheet involves listing assets, liabilities, and equity. Ratios are computed using financial data from the balance sheet.

• List all assets, liabilities, and equity on the balance sheet

• Calculate various financial ratios such as current ratio, debt to equity ratio, and return on equity

• Use formulae like Current Ratio = Current Assets / Current Liabilities

• Interpret the ratios to analyze the financial health and performance of the company

Balance sheet shows assets, liabilities, and equity at a specific point in time. Trial balance lists all ledger accounts with their balances.

• Balance sheet is a snapshot of a company's financial position at a specific point in time.

• Trial balance is a list of all ledger accounts with their balances to ensure debits equal credits.

• Balance sheet includes assets, liabilities, and equity sections.

• Trial balance is used to prepare financial statements like income statement and balance...read more

Budgeting involves setting financial goals and allocating resources, while forecasting predicts future financial outcomes based on past data and trends.

• Budgeting is a plan for how to allocate resources and achieve financial goals

• Forecasting predicts future financial outcomes based on past data and trends

• Budgeting is typically done on an annual basis, while forecasting can be done on a shorter or longer term basis

• Budgeting involves setting specific targets for revenue, expense...read more

Accumulated depreciation is a contra asset account that represents the total depreciation expense taken on an asset since it was acquired.

• Accumulated depreciation is recorded on the balance sheet as a reduction from the gross amount of fixed assets to arrive at the net book value.

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

• For example, if a company records $1,000 in dep...read more

DTA stands for Deferred Tax Asset and DTL stands for Deferred Tax Liability.

• DTA is an asset recorded on a company's balance sheet that may be used to reduce taxable income in the future.

• DTL is a liability recorded on a company's balance sheet that represents taxes that have been accrued but not yet paid.

• DTA arises when a company has overpaid taxes or has tax deductions that exceed its taxable income.

• DTL arises when a company has underpaid taxes or has tax liabilities that exc...read more

Standard costing formula calculates the expected cost of a product based on predetermined standards.

• Standard costing formula includes direct materials, direct labor, and overhead costs.

• It helps in comparing actual costs with standard costs to identify variances.

• Formula: Standard Cost = Standard Quantity of Inputs x Standard Price of Inputs