60+ Finance Intern Interview Questions and Answers

The country's current economic condition is stable but facing challenges.

• The GDP growth rate has slowed down in the past year.

• Unemployment rate has increased slightly.

• Inflation is under control but rising prices of essential commodities are a concern.

• Government policies and reforms are being implemented to boost economic growth.

• Exports have been affected by global trade tensions.

• Stock market performance has been volatile.

• Foreign direct investment has shown positive growth.

• Inc...read more

Warren Buffett, George Soros, Peter Lynch, Benjamin Graham are some famous persons of share market.

• Warren Buffett is known as the Oracle of Omaha and is one of the most successful investors of all time.

• George Soros is a hedge fund manager and philanthropist who famously made a billion dollars in a single day by shorting the British pound.

• Peter Lynch is a former mutual fund manager who is known for his investment strategy of 'investing in what you know'.

• Benjamin Graham is cons...read more

A merger and acquisition is a corporate strategy involving the combination of two or more companies into a single entity.

• Mergers and acquisitions are commonly used to achieve growth, diversification, or synergy.

• A merger occurs when two companies agree to combine their operations and assets to form a new company.

• An acquisition happens when one company purchases another company, becoming its new owner.

• Mergers and acquisitions can be friendly or hostile, depending on the agreeme...read more

The P/E ratio is calculated to assess the relative value of a company's stock by comparing its price to its earnings.

• P/E ratio helps investors determine if a stock is overvalued or undervalued.

• A high P/E ratio suggests that investors have high expectations for future earnings growth.

• A low P/E ratio may indicate that a stock is undervalued or that the company is facing challenges.

• P/E ratio is commonly used in fundamental analysis to compare companies within the same industry.

• F...read more

Key Performance Indicators (KPIs) for analyzing financial statements include profitability ratios, liquidity ratios, and efficiency ratios.

• Profitability ratios such as return on assets (ROA) and return on equity (ROE) measure the company's ability to generate profit from its assets and equity.

• Liquidity ratios like current ratio and quick ratio assess the company's ability to meet short-term obligations with its current assets.

• Efficiency ratios like asset turnover ratio and in...read more

Taxation is the process of collecting money from individuals and businesses by the government to fund public services.

• Taxation is an important source of revenue for the government to fund public services like healthcare, education, and infrastructure.

• It is mandatory for individuals and businesses to pay taxes on their income, property, and goods and services they purchase.

• The tax system varies from country to country and can be progressive, proportional, or regressive.

• Future ...read more

Venture capitalists & Private Equity are investors who provide funding to startups and companies in exchange for equity.

• Venture capitalists invest in early-stage startups with high growth potential

• Private equity firms invest in established companies with the aim of improving their operations and profitability

• Both types of investors provide funding in exchange for equity ownership in the company

• Venture capitalists typically invest smaller amounts of money compared to private e...read more

I have a passion for photography and have won a few local competitions.

• I have been practicing photography as a hobby for the past 5 years

• I have won first place in a local photography competition for landscape photography

• I also enjoy portrait photography and have done a few shoots for friends and family

• I believe my attention to detail and creativity in photography translates well to finance

Hospital sector is subject to various tax implementations.

• Hospitals are exempted from paying income tax under Section 11 of the Income Tax Act.

• Goods and Services Tax (GST) is applicable on healthcare services provided by hospitals.

• Customs duty is levied on imported medical equipment and devices.

• Property tax is applicable on the land and buildings owned by hospitals.

• Excise duty is applicable on certain medical supplies and equipment.

• Tax incentives are provided to hospitals for...read more

TDS stands for Tax Deducted at Source. Excel can be used to calculate TDS amounts and generate reports.

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

• Excel can be used to calculate TDS amounts based on specified rates and generate reports for TDS deductions.

• Formulas in Excel can be used to calculate TDS amounts automatically based on income and tax rates.

• Excel can also be used to create TDS certificates for employees or vendors.

• Using Excel functions like SUM...read more

GameStop stock surge and subsequent fall due to Reddit group's coordinated buying.

• GameStop stock price surged from $20 to $347 in January 2021

• Reddit group r/WallStreetBets coordinated buying of GameStop stock

• Hedge funds lost billions due to short positions on GameStop

• Robinhood and other trading platforms restricted buying of GameStop stock

• GameStop stock price fell to around $40 in the following weeks

The new tax regime was introduced in India in 2020, offering taxpayers the option to choose between the old and new tax slabs.

• The new tax regime has lower tax rates but fewer deductions and exemptions.

• Taxpayers can choose between the old and new tax regimes based on which one is more beneficial for them.

• The new tax regime is aimed at simplifying the tax structure and reducing the tax burden on taxpayers.

• The new tax regime has seven tax slabs, ranging from 5% to 35%.

• Some of th...read more

TDS rates vary based on the type of income and are governed by different sections of the Income Tax Act.

• TDS rate for salary income is as per the individual's tax slab

• TDS rate for interest income is usually 10%

• TDS rate for rent income is 10% if the annual rent exceeds Rs. 2.4 lakhs

• TDS rate for professional fees is 10%

• TDS rate for commission income is 5%

I chose valuation as my domain because of my interest in analyzing financial statements and understanding the true worth of a company.

• I have a strong background in accounting and finance, which has given me a solid foundation in financial analysis.

• Valuation is a critical aspect of finance, as it helps investors make informed decisions about which companies to invest in.

• I find it fascinating to analyze financial statements and understand the underlying factors that drive a com...read more

VLOOKUP is a function in Excel used to search for a value in a table and return a corresponding value from another column.

• VLOOKUP stands for vertical lookup.

• It is commonly used to find specific data in large datasets.

• The formula requires four arguments: lookup value, table array, column index number, and range lookup.

• The lookup value is the value you want to search for.

• The table array is the range of cells where the data is located.

• The column index number is the column from w...read more

Finance refers to the management of money and investments, including budgeting, saving, lending, and investing.

• Finance involves managing money and investments

• It includes activities such as budgeting, saving, lending, and investing

• Finance helps individuals and organizations make informed financial decisions

• Examples of finance include personal budgeting, corporate finance, and investment banking

Yes, it is helpful in my future.

• Having a finance internship will provide me with practical experience and skills that are valuable in the finance industry.

• It will enhance my understanding of financial concepts and processes.

• I will have the opportunity to network with professionals in the field and potentially secure future job opportunities.

• The internship will also allow me to apply theoretical knowledge gained in my studies to real-world scenarios.

• I can learn about different...read more

Share market is a platform where stocks and securities are traded among investors.

• It is also known as stock market or equity market.

• Companies issue shares to raise capital and investors buy and sell these shares.

• The prices of shares are determined by supply and demand.

• Share market indices like S&P 500 and Dow Jones Industrial Average track the performance of the market.

• Investors can make profits through capital gains or dividends.

• Share market is regulated by government bodies...read more

Advance tax is a system of paying tax in advance based on estimated income for the year.

• Advance tax is a method of paying a portion of your taxes before the end of the financial year.

• It is applicable to individuals, self-employed professionals, and businesses with tax liabilities above a certain threshold.

• The purpose of advance tax is to ensure regular inflow of taxes to the government and prevent tax evasion.

• Failure to pay advance tax may result in penalties and interest cha...read more

Ad sales involve selling advertising space or time to businesses or individuals to promote their products or services.

• Ad sales is a key revenue stream for media companies, including TV networks, websites, and magazines.

• Sales representatives work to secure advertising deals by pitching the benefits of their platform to potential clients.

• Ad sales can involve selling traditional ad placements like TV commercials or print ads, as well as digital advertising like banner ads or spo...read more

TDS stands for Tax Deducted at Source. It is a tax deduction made at the time of payment.

• TDS is deducted by the payer and deposited with the government on behalf of the payee.

• The rate of TDS varies depending on the type of payment and the nature of the transaction.

• TDS can be calculated by applying the applicable TDS rate on the total payment amount.

• For example, if the TDS rate is 10% and the payment amount is $1,000, the TDS amount would be $100.

Golden rules of accounting are basic principles that guide the process of recording financial transactions. Balance sheet shows assets, liabilities, and equity. Cash flow statement shows cash inflows and outflows.

• 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.

• Balance sheet: Shows a company's financial position at a specific point in time, including assets (what the...read more

Credit is money received, debit is money paid out.

• Credit refers to an increase in assets or decrease in liabilities, while debit refers to a decrease in assets or increase in liabilities.

• Credit is recorded on the right side of an account, while debit is recorded on the left side.

• Examples of credit include receiving a loan or payment from a customer, while examples of debit include paying bills or purchasing inventory.

• Credit and debit are essential concepts in accounting and f...read more

Key financial ratios for liquidity include current ratio, quick ratio, and cash ratio.

• Current ratio: measures a company's ability to pay off short-term liabilities with its current assets

• Quick ratio: similar to current ratio but excludes inventory from current assets

• Cash ratio: measures a company's ability to cover short-term liabilities with cash and cash equivalents

No, withholding tax and TDS are not the same.

• Withholding tax is a broader term that includes TDS (Tax Deducted at Source) as one of its components.

• TDS is a specific type of withholding tax where tax is deducted at the source of income.

• Withholding tax can also include other types of taxes withheld by a payer before paying the income to the recipient.

• For example, TDS is a form of withholding tax applied to income from interest, dividends, salary, etc.

The market price of prevailing stocks varies constantly.

• Market prices of stocks are determined by supply and demand.

• Factors such as company performance, economic conditions, and investor sentiment can affect stock prices.

• Examples of prevailing stocks include Apple, Amazon, and Microsoft.

• Stock prices can be tracked through financial news outlets and online trading platforms.

Debtnote and credit note are financial documents used to track transactions between parties.

• Debtnote is issued by the seller to the buyer for the amount owed by the buyer.

• Credit note is issued by the seller to the buyer for the amount owed by the seller.

• Debtnote increases the buyer's liability, while credit note decreases the buyer's liability.

• Both debtnote and credit note serve as evidence of the transaction and are used for accounting purposes.

Mutual funds are investment vehicles that pool money from multiple investors to invest in securities, while insurance is a contract between an individual and an insurer to provide financial protection against specific risks.

• Mutual funds are primarily investment products, while insurance is primarily a risk management product.

• Mutual funds invest in securities such as stocks and bonds, while insurance provides financial protection against specific risks such as death, disabilit...read more

Reverse charge mechanism is a system where the recipient of the goods or services is liable to pay the tax instead of the supplier.

• Under reverse charge mechanism, the recipient of the goods or services is responsible for paying the tax to the government instead of the supplier.

• This mechanism is commonly used in B2B transactions where the recipient is a registered business entity.

• It helps in preventing tax evasion and ensuring compliance with tax regulations.

• Examples include s...read more

I am fluent in English, Spanish, and French.

• English

• Spanish

• French

The three financial statements (income statement, balance sheet, and cash flow statement) are interconnected and provide a comprehensive view of a company's financial performance.

• The income statement shows the company's revenues and expenses over a period of time, which ultimately impacts the net income reported on the statement.

• The net income from the income statement flows into the balance sheet as retained earnings, affecting the company's equity position.

• The cash flow sta...read more

Budgeting format involves creating a detailed plan for managing and allocating financial resources.

• Budgeting typically involves creating a spreadsheet or financial software program to track income, expenses, and savings goals.

• It is important to categorize expenses, set financial goals, and regularly review and adjust the budget as needed.

• Common budgeting formats include zero-based budgeting, incremental budgeting, and activity-based budgeting.

• Examples of budgeting formats inc...read more

Different costs are treated differently based on their nature and impact on financial statements.

• Different costs are classified as either variable or fixed costs.

• Variable costs change with the level of production or sales, while fixed costs remain constant.

• Some costs are considered direct costs, directly attributable to a specific product or service.

• Other costs are indirect costs, not directly traceable to a specific product or service.

• Certain costs are considered sunk costs,...read more

Working capital management involves managing a company's current assets and liabilities to ensure efficient operations and financial health.

• It focuses on optimizing the balance between current assets (cash, inventory, accounts receivable) and current liabilities (accounts payable, short-term debt)

• Effective working capital management helps improve liquidity, reduce costs, and maximize profitability

• Examples include implementing efficient inventory management systems, negotiatin...read more

Expense ratio is a financial metric used to measure the efficiency of a company in managing its expenses.

• Expense ratio is calculated by dividing a company's total expenses by its total revenue.

• It helps investors evaluate how well a company is controlling its costs.

• Different types of ratios include profitability ratios, liquidity ratios, leverage ratios, and efficiency ratios.

• Examples of ratios include return on equity (ROE), current ratio, debt-to-equity ratio, and inventory ...read more

Financial modelling is the process of creating a mathematical representation of a financial situation or system.

• It involves using various financial tools and techniques to analyze and forecast financial performance.

• Financial models can be used for budgeting, forecasting, valuation, and risk analysis.

• Examples of financial models include discounted cash flow models, scenario analysis, and regression analysis.

• Financial modelling is commonly used in investment banking, corporate ...read more

Financial statements are documents that provide an overview of a company's financial performance and position.

• Financial statements include the income statement, balance sheet, and cash flow statement.

• The income statement shows a company's revenues and expenses over a specific period.

• The balance sheet provides a snapshot of a company's assets, liabilities, and equity at a specific point in time.

• The cash flow statement shows how cash is generated and used by a company during a ...read more

Reconciliation is the process of comparing two sets of records to ensure they are in agreement and resolving any discrepancies.

• Reconciliation involves matching transactions or balances between different accounts or systems.

• It helps identify errors, fraud, or missing transactions.

• Examples include bank reconciliation, where you compare your bank statement with your own records to ensure they match.

• Another example is inventory reconciliation, where physical counts are compared w...read more

Trading involves buying and selling financial instruments such as stocks, bonds, and commodities in order to make a profit.

• Trading is the act of buying and selling financial instruments in various markets.

• Traders aim to profit from short-term price movements by speculating on the direction of asset prices.

• Different types of trading include day trading, swing trading, and position trading.

• Trading can be done in various markets such as stocks, bonds, forex, and commodities.

• Risk...read more

Travclan is a fintech platform that provides automated solutions for managing finances and payments for travel agencies.

• Provides automated solutions for managing finances and payments

• Specifically tailored for travel agencies

• Helps streamline financial processes and improve efficiency

EBIT formula calculates a company's earnings before interest and taxes.

• EBIT = Revenue - Operating Expenses

• Operating expenses include costs like salaries, rent, utilities, and depreciation

• EBIT is a measure of a company's profitability before taking into account interest and taxes

• Example: If a company has $1,000,000 in revenue and $500,000 in operating expenses, EBIT would be $500,000

Mutual funds are investment vehicles that pool money from multiple investors to purchase securities.

• Investors buy shares in the mutual fund, which represents a portion of the fund's holdings

• Professional fund managers use the pooled money to buy a diversified portfolio of stocks, bonds, or other securities

• Investors benefit from the fund's returns and share in any profits or losses

• Mutual funds offer diversification, liquidity, and professional management

• Examples of mutual fund ...read more

Cash flow statement is a financial statement that shows the inflows and outflows of cash in a business over a specific period of time.

• It provides insights into how well a company manages its cash position.

• Consists of three main sections: operating activities, investing activities, and financing activities.

• Helps investors and analysts assess the financial health and liquidity of a company.

• Example: Cash received from customers, cash paid for operating expenses, cash used for pu...read more

Insurance is a means of protection from financial loss. There are various types of insurance available.

• Life insurance

• Health insurance

• Auto insurance

• Homeowners insurance

• Travel insurance

• Pet insurance

• Disability insurance

• Liability insurance

• Business insurance

Storytelling is the art of conveying a message or information through a narrative or sequence of events.

• Storytelling involves using characters, plot, and setting to engage the audience.

• It helps to make complex information more relatable and easier to understand.

• Examples include using case studies, anecdotes, or personal experiences to illustrate a point.

Strength is a positive attribute or quality that contributes to success, while weakness is a limitation or area of improvement.

• Strengths are skills, qualities, or experiences that set you apart from others and help you excel in your work.

• Weaknesses are areas where you may struggle or need to develop further to reach your full potential.

• Examples of strengths could include strong analytical skills, effective communication, or leadership abilities.

• Examples of weaknesses could in...read more

Depreciation is the allocation of the cost of a tangible asset over its useful life.

• Depreciation is a non-cash expense that reduces the value of an asset on the balance sheet.

• It reflects the wear and tear, aging, or obsolescence of an asset.

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

• Example: A company purchases a machine for $10,000 with a useful life of 5 years. Using straight-line depreciation, the annual deprecia...read more