Information Process Enabler

Information Process Enabler Interview Questions and Answers

Updated 2 May 2024

Q1. what is depreciation and its types?

Ans.

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

Depreciation is a non-cash expense that reduces the value of an asset over time.
Types of depreciation include straight-line, double declining balance, units of production, and sum-of-the-years-digits.
Straight-line depreciation allocates an equal amount of depreciation expense each year.
Double declining balance front-loads depreciation, with higher amounts in the early years.
Units of production depreci...read more

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

The golden rules include: Debit what comes in, Credit what goes out; Debit the receiver, Credit the giver; Debit expenses and losses, Credit income and gains.
These rules help ensure accuracy and consistency in financial reporting.
For example, when a company receives cash from a customer, it would debit the cash account (what comes in) and credit the revenue account (...read more

Ans.

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

Debit the receiver, credit the giver
Debit what comes in, credit what goes out
Debit expenses and losses, credit income and gains
Debit assets, credit liabilities and equity
These rules ensure that every transaction is recorded accurately and consistently

Ans.

Journal entries for prepaid and outstanding are used to record advance payments and unpaid expenses.

Prepaid expenses are recorded as assets on the balance sheet until they are used up.
Outstanding expenses are recorded as liabilities on the balance sheet until they are paid.
Journal entry for prepaid expenses: Debit Prepaid Expense, Credit Cash/Bank
Journal entry for outstanding expenses: Debit Expense, Credit Accounts Payable

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Ans.

Prepaid and accrual are accounting methods used to record expenses and revenues in the period they are incurred, rather than when cash is exchanged.

Prepaid expenses are expenses paid in advance but not yet incurred, recorded as assets until they are used up.
Accrual expenses are expenses that have been incurred but not yet paid, recorded as liabilities until they are settled.
Prepaid revenue is revenue received in advance but not yet earned, recorded as liabilities until it is ...read more

Ans.

Unearned expenses are costs that have been paid in advance but have not yet been incurred.

Unearned expenses are also known as prepaid expenses.
These expenses are initially recorded as assets on the balance sheet.
As the expenses are incurred, they are gradually recognized as expenses on the income statement.
Examples include prepaid rent, insurance premiums, and subscription fees.

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