20+ Senior Accounting Specialist Interview Questions and Answers

Accumulated Depreciation is the total depreciation expense recognized for an asset over its useful life.

• Accumulated Depreciation is a contra-asset account that is subtracted from the asset's cost to determine its net book value.

• It represents the cumulative amount of depreciation expense recorded for an asset since its acquisition.

• Accumulated Depreciation increases over time as depreciation expense is recognized.

• It is shown on the balance sheet as a negative value.

• For example,...read more

Month end closing procedures are the steps taken to finalize financial statements at the end of each month.

• Reconciling accounts

• Posting adjusting entries

• Reviewing financial statements

• Preparing reports for management

• Closing temporary accounts

• Ensuring compliance with accounting standards

• Archiving financial records

• Preparing for the next month's accounting cycle

Unbilled revenue refers to revenue that has been earned but not yet invoiced to the customer.

• Unbilled revenue is a liability on the balance sheet until it is invoiced.

• It represents the amount of revenue that the company has recognized but has not yet received payment for.

• Unbilled revenue can occur in industries where services are provided over a period of time, such as consulting or software development.

• For example, if a consulting firm completes a project but has not yet sen...read more

Deferred revenue is a concept where revenue is received in advance but recognized as income over time as the goods or services are delivered.

• Deferred revenue is a liability on the balance sheet until it is earned.

• When revenue is received in advance, it is recorded as a debit to cash and a credit to deferred revenue.

• As the goods or services are delivered, the deferred revenue is recognized as income by debiting deferred revenue and crediting revenue.

• Examples of deferred revenu...read more

Unbilled revenue refers to revenue that has been earned but not yet invoiced to the customer.

• Unbilled revenue is recorded as a current asset on the balance sheet.

• The journal entry for unbilled revenue involves debiting unbilled receivables and crediting revenue.

• Once the invoice is generated, the unbilled revenue account is credited and accounts receivable is debited.

• Unbilled revenue is common in service-based industries where work is completed before invoicing.

• Unbilled revenu...read more

COGS can be found by subtracting ending inventory from beginning inventory and adding purchases. Unbilled revenue is revenue that has been earned but not yet billed to the customer.

• COGS = Beginning Inventory + Purchases - Ending Inventory

• Unbilled revenue is revenue recognized in the income statement but not yet invoiced to the customer

• Unbilled revenue is a liability on the balance sheet until it is invoiced

Accrual is recognizing revenue and expenses when they are incurred, not when cash is exchanged. Deferred revenue is when payment is received before revenue is earned.

• Accrual accounting matches revenue and expenses to the time period they are incurred, not when cash is exchanged

• Deferred revenue is when a company receives payment for goods or services before they are actually delivered or earned

• Accrual accounting provides a more accurate representation of a company's financial ...read more

Outstanding expenses are unpaid bills while accrued expenses are expenses incurred but not yet paid.

• Outstanding expenses are recorded as accounts payable on the balance sheet.

• Accrued expenses are recorded as liabilities on the balance sheet.

• Examples of outstanding expenses include unpaid rent, utilities, and vendor invoices.

• Examples of accrued expenses include salaries, interest, and taxes.

• Both outstanding and accrued expenses are recognized in the income statement as expense...read more

Unbilled revenue should be accounted for when it is earned but not yet invoiced to the customer.

• Recognize unbilled revenue when the performance obligation is satisfied and revenue is earned.

• Record unbilled revenue as an asset on the balance sheet.

• Adjust unbilled revenue periodically to reflect the actual amount that should be billed to the customer.

• Example: A construction company completes a project in December but does not bill the customer until January. The revenue earned ...read more

Realised forex gain/loss is when the exchange rate changes and the transaction is completed, while unrealised forex gain/loss is when the exchange rate changes but the transaction is not completed.

• Realised forex gain/loss is recorded when an actual transaction occurs and the exchange rate has changed since the initial transaction.

• Unrealised forex gain/loss is recorded when the exchange rate changes but the transaction has not been completed yet.

• Realised gain/loss affects the ...read more

Adjustments in consolidation involve eliminating intercompany transactions, adjusting for differences in accounting policies, and recognizing goodwill.

• Eliminating intercompany transactions to avoid double counting

• Adjusting for differences in accounting policies to ensure consistency

• Recognizing goodwill to account for the premium paid in acquisitions

Accrual of expenses refers to recognizing expenses in the period they are incurred, regardless of when they are paid.

• Accrual of expenses helps in matching expenses with revenues in the same accounting period.

• Examples include recognizing salaries expense for work done by employees even if the payment is made in the next month.

• Another example is recognizing interest expense on a loan even if the payment is due in the next quarter.

Unearned revenue is money received by a company for goods or services that have not yet been provided.

• Unearned revenue is a liability on the company's balance sheet until the goods or services are delivered.

• It represents an obligation to provide goods or services in the future.

• Common examples include prepaid rent, magazine subscriptions, and advance payments for services.

• As the goods or services are provided, the unearned revenue is recognized as revenue on the income stateme...read more

Deferred revenue is revenue received in advance but not yet earned. Entries include debit to cash or accounts receivable and credit to deferred revenue.

• Deferred revenue represents money received for goods or services that have not yet been provided.

• Entries for deferred revenue typically involve debiting cash or accounts receivable and crediting deferred revenue.

• As the revenue is earned, the deferred revenue is reduced and recognized as revenue on the income statement.

• Example:...read more

Prepaid entries are recorded as assets and expensed over time as the benefit is realized.

• Prepaid expenses are recorded as assets on the balance sheet.

• Example: If you pay $1,200 for a one-year insurance policy, record it as a prepaid expense.

• Each month, recognize $100 as an expense, reducing the prepaid asset.

• Adjusting entries are made at the end of each accounting period to reflect the expense.

• This ensures accurate matching of expenses with revenues in the correct period.

Deferred revenue is revenue that has been received by a company, but has not yet been earned.

• Deferred revenue is a liability on the company's balance sheet.

• It represents revenue that has been collected in advance of being earned.

• As the revenue is earned, it is recognized on the income statement.

• Common examples include subscription services, gift cards, and advance payments for services.

• Deferred revenue is also known as unearned revenue.

Financial statements are formal records of the financial activities and position of a business, organization, or individual.

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

• They provide information on the financial performance, financial position, and cash flows of an entity.

• They are used by investors, creditors, and management to make informed decisions.

• Examples of financial statements include annual reports, quarterly reports, and SE...read more

Accruals recognize revenues and expenses when they occur, while provisions account for future liabilities or losses.

• Accruals are based on the matching principle, ensuring revenues and expenses are recorded in the period they occur.

• Example of accrual: Recording sales revenue when a product is delivered, even if payment is received later.

• Provisions are estimates for future liabilities, reflecting potential obligations that may arise.

• Example of provision: Setting aside funds for...read more

Accrual is an accounting method that recognizes revenues and expenses when they are incurred, regardless of when cash is exchanged.

• Accrual accounting matches revenues with expenses in the same accounting period

• It provides a more accurate picture of a company's financial position

• Examples include recognizing revenue when a service is performed, even if payment is not received until a later date