Investment Banking Associate Interview Questions and Answers for Freshers

CFO stands for Cash Flow from Operations. It is a measure of a company's ability to generate cash from its core business activities.

• CFO is calculated by starting with net income and adding back non-cash expenses (such as depreciation and amortization) and adjusting for changes in working capital.

• Formula: CFO = Net Income + Non-cash Expenses + Changes in Working Capital

• CFO is a key metric used by investors and analysts to assess a company's financial health and sustainability....read more

The linkage between the 3 financial analysis involves understanding how the income statement, balance sheet, and cash flow statement are interconnected.

• Income statement shows the company's profitability over a period of time.

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

• Cash flow statement tracks the inflow and outflow of cash within the company.

• Changes in one statement can impact the others, such as increased revenue on the...read more

Cost accounting is a branch of accounting that focuses on analyzing and controlling costs within a business.

• It involves tracking and recording all costs associated with producing a product or providing a service.

• Cost accountants analyze cost behavior, cost-volume-profit relationships, and cost variances.

• It helps management make informed decisions about pricing, budgeting, and resource allocation.

• Examples include determining the cost of goods sold, calculating the break-even p...read more

Investment banking involves providing financial services to corporations, governments, and other institutions, including raising capital, mergers and acquisitions, and advisory services.

• Investment banking helps companies raise capital through issuing stocks and bonds

• It also involves advising companies on mergers and acquisitions

• Investment bankers provide financial advisory services to clients

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

• Debit what comes in, credit what goes out (Real Accounts)

• Debit the receiver, credit the giver (Personal Accounts)

• Debit all expenses and losses, credit all incomes and gains (Nominal Accounts)