External Auditor Interview Questions and Answers

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

• The first golden rule is the Personal Account rule, which states that debit the receiver and credit the giver.

• The second golden rule is the Real Account rule, which states that debit what comes in and credit what goes out.

• The third golden rule is the Nominal Account rule, which states that debit all expenses and losses and credit all incomes and gains.

Revenue recognition steps involve identifying the transaction, determining the amount of revenue to be recognized, and allocating the revenue to the appropriate period.

• Identify the transaction: Determine when the revenue is earned and collectible.

• Determine the amount of revenue: Calculate the total revenue to be recognized based on the transaction.

• Allocate revenue to the appropriate period: Recognize the revenue in the period it is earned, following the matching principle.

• Exa...read more