Origo Commodities Interview Questions and Answers

Journal entries for depreciation and disposal of fixed assets involve recording depreciation expense and gain/loss on disposal.

• Depreciation expense is debited to Depreciation Expense account and credited to Accumulated Depreciation account.

• When a fixed asset is disposed of, the book value of the asset is removed from the books by debiting Accumulated Depreciation and crediting the Fixed Asset account.

• Any gain or loss on disposal is recorded by debiting/crediting the Fixed Ass...read more

The journal entry for Sales Return involves debiting Sales Returns and crediting Accounts Receivable or Cash.

• Debit the Sales Returns account to reduce sales revenue

• Credit Accounts Receivable if the customer is returning the goods on credit

• Credit Cash if the customer is returning the goods for a refund

• Example: Debit Sales Returns $500, Credit Accounts Receivable $500

Reclass entries BS refer to reclassification entries in the balance sheet.

• Reclass entries BS involve moving amounts from one account to another within the balance sheet.

• These entries are made to correct errors, adjust classifications, or reflect changes in accounting standards.

• For example, moving an amount from a long-term asset account to a current asset account.

• Reclass entries BS can impact financial statements and ratios.

• Proper documentation and explanation are important f...read more

Amortization is the process of spreading out the cost of an intangible asset over its useful life.

• Amortization is commonly used in accounting to allocate the cost of intangible assets such as patents, copyrights, and trademarks over their useful life.

• It is similar to depreciation, which is used for tangible assets like buildings and equipment.

• The amortization expense is recorded on the income statement and reduces the value of the intangible asset on the balance sheet.

• Amortiz...read more

Golden Rules of Accounting are basic principles that guide the process of recording financial transactions.

• There are three Golden Rules of Accounting: Debit the receiver, Credit the giver; Debit what comes in, Credit what goes out; Debit expenses and losses, Credit income and gains.

• These rules help maintain the balance in accounting entries and ensure accuracy in financial reporting.

• For example, when a company receives cash from a customer, the cash account is debited (increa...read more