Financial accounting short questions and answers. Accounting Mba Full questions and answers 1st semester 2012 2019-01-25

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Accounting Mba Full questions and answers 1st semester 2012

financial accounting short questions and answers

Working capital is a financial metric that calculates the resources available to the company to finance its day-to-day operations. How do I compute the units of production method of depreciation? Interest on capital paid, Expenditure on purchase or installation of an asset, brokerage and commission paid. The carriage inwards costs are considered to be part of the cost of items purchased. The customer will record the £50,000 payment with a debit to a long-term asset account such as Construction Work in Progress or Down payment on New Equipment, and will credit Cash. Basically, it is the amount that corresponds only to the period of time indicated in the heading of the income statement. Tip 1: Liquidity is also another parameter which can be mentioned if required. In the 37th month, the income statement will report £1,000 of depreciation expense.

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Top 100 Accounting Interview Questions & Answers

financial accounting short questions and answers

Thus, it is only for internal use. Accounting is all about recording daily business activities while auditing is the checking that whether all these events have been noted down correctly or not. Journal is also known as Book of Original Entry or the Book of Prime Entry. This is required because if you are interviewing for a start-up where survival is the focus rather than the effectiveness of controls, they will prefer using Tally which will be very cost efficient for them. In order to maximize the value of the firm the costs of all inputs, including capital input, must be minimum and in this context the should be able to measure the cost of capital.

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Top 100 Accounting Interview Questions & Answers

financial accounting short questions and answers

Its buildings will be reported at their cost minus their accumulated depreciation due to the cost principle and the matching principle. The reason is that it causes the company's net income in the early years of an asset's life to be lower than it would be under the straight-line method. Principles of Accounting was often the title of the introductory course in accounting. Repeated distribution method:- is where the overheads of service department are distributed to other departments on agreed percentage, and this process is repeated till the amount of overheads are exhausted to consider further apportionment. The adjusting entry will consist of a debit of £1,000 to Interest Receivable a balance sheet account and a credit of £1,000 to Interest Income or Interest Revenue income statement accounts. The reason is that all of the interest will be due on February 28.

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Important Short Questions and Answers: Investments and Financial Accounting

financial accounting short questions and answers

These costs are recorded in accounts namely Plant, Property, Equipment. A master account receivable could be anything, it could be account receivable for various individual receivable accounts. It gives relative importance to an item or event. Have a look at this Question 13 — Give a suggestion for improving the working capital flow of the company According to me, stock-in-hand can be the key to improving the working capital of the company. In other industries, negative working capital may signal a company is facing financial trouble. A write-down in a company's inventory is recorded by reducing the amount reported as inventory. This looks fairly simple but working capital management practically involves — debt management, inventory management, revenue collection, short-term investments, planning payments as per the net working capital inflow.

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Adjusting entries

financial accounting short questions and answers

Based on extensive research and feedback from professionals at corporations, this list has the most likely interview questions, Equity Research Interview Questions Equity research interview questions and answers. Q: Is it possible for a company to show positive cash flows but be in grave trouble? They have long term implications on the company. Typical accrued expenses include wages, interest, utilities, repairs, bonuses, and taxes. Describe net capital investment as a component of investment analysis Net capital investment represents the amounts of funds committed to a project. It will also report Insurance Expense for the month of December as £2,000---the cost that has expired during December.

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Commerce Question Bank

financial accounting short questions and answers

Example: rent, lighting, telephone expenses, etc. I would use the liability account Accounts Payable for suppliers' invoices that have been received and must be paid. In other words, the readers of a company's financial statements can presume that the same rules and measurements were followed in all of the years being reported. To illustrate, let's assume that a retailer purchases an item for resale by paying £20 to the supplier. Selection of accounting period depends on characteristics like business organization, statutory requirements etc.

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195 Accounting Principles Questions and Answers for Accounting Exams …

financial accounting short questions and answers

Bonds payable that mature or come due within one year of the balance sheet date will be reported as a current liability if the issuer of the bonds must use a current asset or will create a current liability in order to pay the bondholders when the bonds mature. However, a disclosure is required. Behavioral interview questions are very common for finance jobs, and yet applicants are often under-prepared for them. What is periodicity in accounting? The residual value is the value that any asset holds after its estimated life time. Visit our to view past quizzes with answers and rationales. Others may choose to follow the original formula. The Financial Accounting Standards Board refers to consistency as one of the characteristics or qualities that makes accounting information useful.

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Consignment Accounting Questions and Answers

financial accounting short questions and answers

After practical implementation of the budget if any variation is seen in the actual result to the budget result then the reasons for the variations are fount out and corrective actions are taken to correct variations. The company will have to remit the £7,000 to the state shortly after collecting the money. . Some people will switch to straight line at this point and record the remaining £40,960 over the remaining 6 years in equal amounts of £6,827 per year. Accruals are adjustments for 1 revenues that have been earned but are not yet recorded in the accounts, and 2 expenses that have been incurred but are not yet recorded in the accounts. These accounting policies differ mainly in two areas: Valuation of inventory and Calculation of depreciation.

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Common Finance Interview Questions (and Answers)

financial accounting short questions and answers

It can be direct or indirect. Routine repairs are revenue expenditures because they are charged directly to an account such as Repairs and Maintenance Expense. If a company purchases a new delivery van for £30,000 plus £2,100 of sales tax, the company will record the truck as an asset at its total cost of £32,100. Capital investment decisions involve substantial outlays 16. It has adequate controls, multiple modules which have access limitation, various reports can be extracted and customization is also possible. It is also known as the historical cost principle.

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FAR Sample CPA Exam Questions

financial accounting short questions and answers

Thus, it is for external use. Best, Haseeb Vishnu, If you are following accrual accounting you need to ensure that expense is recognized as an accounts payable - and then you are just paying down the accounts payable. Viewers ranked it as one of the best. As the name implies, the dual aspect concept states that every transaction has two sides. These costs are recorded in accounts namely Plant, Property, Equipment.

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