An accountant is a professional who performs accounting functions such as account analysis, auditing, or financial statement analysis. and returns filing.
“Accounting is an art of recording, classifying and summarizing in a significant manner and in terms of money event and transaction which are at least of financial character and interpreting the result thereof “
As per American institute of certified accountant
What are the different types of accounting?
Ans. Different types of accounting are
Financial Accounting – This branch of accounting records, summarises and reports the business transactions that take place over a time period in an organisation. It is required in both the private and public sectors.
Administrative Accounting – Administrative accounting is focused on the administrative aspects of the company and is used above all to assess the fulfillment of the established objectives and improve the implemented strategy. It is very useful for making forecasts and planning the actions and resources to be used.
Tax Accounting -Tax accounting helps to register and prepare reports related to tax returns to the public treasury and payment of taxes.
Cost Accounting – This type of accounting is more focused on companies of an industrial nature. It helps to make a detailed analysis of the unit costs of production, sales, and, in general, of the production process that the company carries out.
Management Accounting – Management accounting has a broader vision than cost accounting since it records all the economic and financial information of the company to be able to make short-term and long-term decisions.
what is cash flow statement and why it is prepared
A cash flow statement is a financial statement that summarizes the amount of cash and cash equivalents entering and leaving a company. The cash flow statement measures how well a company manages its cash position, meaning how well the company generates cash to pay its debt obligations and fund its operating expenses.
What is TDS? Where do you show TDS on a balance sheet?
Ans. TDS (Tax Deducted at Source) is a concept aimed at collecting tax at every source of income. In a balance sheet, it is shown in the assets section, right after the head current asset.
What are Current Assets ?
Current assets are those assets which are either in form of cash or can be converted into cash within one year of the date of finalization of accounts.
There are five main kinds of current assets:
- Cash and equivalents.
- Short- and long-term investments.
- Accounts receivable.(Debtors)
- (Stock)
- Prepaid expenses
What is a bank reconciliation statement?
Ans. A bank reconciliation statement or BRS is a form that allows individuals to compare their personal bank account records to that of the bank. BRS is prepared when the passbook balance differs from the cashbook balance.
What are Intangible Assets in Accounting ?
An intangible asset is an asset that is not physical in nature. Examples of intangible assets include goodwill, brand recognition, copyrights, patents, trademarks
What is Tally Accounting ?
Ans. It is accounting software used by small businesses and shops to manage routine accounting transactions. It is a popular accounting software created by Tally Solutions. It is used for all kinds of accounting-related activities including recording of financial transactions, generating statements of liabilities and assets and other analytical purposes.
What is the abbreviation for the accounting terms debit and credit?
The debit abbreviation is “dr” and credit abbreviation is “cr”.
what is TDS and Where to show TDS in the balance sheet?
TDS stands for Tax Deduction at Source. It is introduced to collect text from the company from where the employee income is generated.
TDS is shown on the assets section, right after the head current asset.
What is Accrued Income ?
Accrued Income is income earned but received.
Example Accrued interest on FD ,Accrued Rent ,Accrued Commission etc.
List out things that fall under intangible assets
Things that fall under intangible asset are:
Patents
Copyrights
Trademarks
Brand names
Domain names
What is working capital?
Working capital is a financial metric that calculates the resources available to the company to finance its day-to-day operations. It is typically calculated by deducting current liabilities from current assets.
What is the marginal cost?
Marginal cost is defined as an increase or decrease in the cost of producing units or serving customers.
List out some of the examples for liability accounts?
Some of the examples of liability accounts are:
Accounts payable
Accrued expenses
Short-term loans payable
Unearned or deferred revenues
Installment loans payable
Current portion of long-term debt
Mortgage loans payable
What is bad debt expense and bad debts recover ?
When the customer of the business do not pay the money of services or goods provided then the customer becomes baddebts.
On the other hand if the customer who fail to pay money pervious pay pay some of amount next year that is bad debts recover.
What are ledger
Collection of Accounts are known as ledger .
A ledger can be referred to as an accounting book that keeps the record of journal entries in chronological order to individual accounts. The process of recording this journal entries is known as posting.
What is cost sheet ?
The cost sheet contains both direct and indirect expenses incurred in producing any product. The classifying the expenses incurred based on administration, office, distribution, and selling overheads.
What Is Management Accounting?
The process of creating organization goals by identifying, measuring, analyzing, interpreting and communicating information to managers is call management or managerial accounting.
What Are Liquid Assets
Liquid assets are defined as assets that can be easily converted into cash. Money owed to your company and inventory are examples of liquid assets in business.
Liquid assets include:
- Accounts receivable (money owing to your business)
- Cash (on hand or in your business checking account)
- Demand deposit (a type of investment)
- Inventory
- Pre-paid insurance (you get your money back if you cancel)
- Investments that mature in less than 90 days (i.e. stocks, treasuries, bonds, mutual funds, money-market funds)
Why are Financial Statements Important?
Financial statements are important because they contain significant information about a company’s financial health. Financial statements help companies make informed decisions since they highlight which areas of the company provide the best ROI (return on investment). It’s also important that companies file financial statements once a year.
What Are Adjusting Journal Entries?
To ensure that financial statements reflect the revenues that have been earned and the expenses that were incurred during the accounting period, adjusting entries are made on the last of an accounting period.
his is a branch of accountancy which deals exclusively with the relations between the various items in the Final Accounts of a concern .Thus it is the process of determining and interpreting numerical relationship between figures of the financial statement.
A ratio is simply one number expressed in terms of another numbers”.
What is fund flow statement ?
A fund flow statement is a statement prepared to analyse the reasons for changes in the financial position of a company between two balance ..
What is the difference between capital expenditures and revenue expenditures?
Capital expenditures are typically one-time large purchases of fixed assets that will be used for revenue generation over a longer period. Revenue expenditures are the ongoing operating expenses, which are short-term expenses used to run the daily business operation
What are contingent liabilities ?
A contingent liability is a potential liability that may occur in the future, such as pending lawsuits or honoring product warranties. If the liability is likely to occur and the amount can be reasonably estimated, the liability should be recorded in the accounting records of a firm.