Basic Accounting

asZ1. what is the entry for bad debts? Bad debts a/c dr. to debtors a/c. 2. What is concept of accounting..? The concept of accounting is to find out the performance of the year and position of the entity at the end year by following the accounting process i.e recording transactions posting them into ledger accounts preparing trail balance finally preparing financial statements 3. WHAT IS DEPRICIATION? Depreciation denotes gradually and permanent decreases in the value of asset due to wear and tear, technology changes, laps of time and accidentquot;
 4. Define journal in one word Day book 5. Salary is paid to a person A wrongly twice a month and after detecting the mistake the salary is paid to the right person B.write the journal entry for the two sequences. B'S SALARY A/C Dr. To A's salary A/c 6. I had this interview in 09. The interviewer kept on asking this question. Why do you want to join JP Morgan chase? Can any1 give me a good answer...??? JP Morgan is a brand it one of the biggest finance firms that an accounts student can think of. There are so many experienced people working here and there is so much to learn from them. The kind of skills that i can acquire here i can't get anywhere. I would love to work for JP Morgan Chase and if i get it it will be a dream come true. 7. What is difference between tax invoiced & retail invoice..? Tax Invoice used for local Sale within state and retail Invoice used for central sale. 8. what is an accured account ? it is a statement of income which is earn, but not received in the accounting year. for exp....outstanding income. 9. what is liability? give some entry 10. WHAT ARE THE DISTINGUISH BETWEEN ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE Accounts Receivable is nothing but the money receivable form Customers. It's also shown as Sundry Debtors under Current Assets, Loans & Advances in the Balance Sheet. Accounts Payable is nothing but the money payable to Creditors/Vendors. It's also shown as Sundry Creditors under Current Liabilities & Provisions in the Balance Sheet. 11.whts accrued interest..? Interest payable on borrowed money (Loan) as on a particular date but is not due is accrued interest.(interest due but not paid) 12. what is reserve capital..? The share capital which is kept for future fund which can raise any time depends on co. 13. What is the basic difference between bond and debenture? it,s very urgent please guys give me a quick reply bond is not related to the company it is issuing banks bank is giving int and principal amt at maturity time. debenture means it is a certificate issuing the company. the certificate bearing interest rate on face. interest will be payable every year ending. 14. what is the Cash purchase limit.? As per Income tax rules we didn't make cash entry of Rs.20000 and above. so that, the limit is Rs.20000/- 15. what is the difference between excise duty and customs duty If we are manufacturing any goods this case we have to paid tax, called excise duty (if good is excise able). but when we import goods and pay duty, called custom duty. 16. How to cancel an invoice and what is the accounting entries 17. What is a accounting entries for entering a invoice 18. What is a Hold and Release 19. Withhold Tax Types 20. What are all the Taxes Available in Accounts Payables 21. What is the difference between the service organisation and trading organisation 22. whaT IS THE notional cash pooling 23. Give an accounting treatment for Investment made worth 100 today,after 6months its value is 60. When we purchase the investments the entry will be Investments A/C.......Dr 100 To Bank A/C........... 100 After six months the value of investment if Rs 60 entry will be Bank A/C................Dr 60 P&L A/C.................Dr 40 To Investment A/c..............100 24. How many type of Invoices? 25. Explain . 1. Retail Invoice. 2. Tax Invoice. 3. Commercial Invoice. 4. E1 Invoice. Retail invoice is the invoice which is used when the goods are purchased in retail form from the stores which includes discription, quantity, rate, discount every thing will be mentioned including of tax. Tax invoice is the invoice in which all the tax detailes are mentioned clearly . commercial invoice is the general invoice which is prepared by all the companies E-1 invoice is the invoice which is used by the parties from different states used during transportation to avoid multiple taxation. 26. What's the VAT percentage? Vat is value added tax 13.5% Raw Material 4% 27. what is SEC? Securities exchage commission 28. Contingent goods? The acquisition of goods by the seller depends upon uncertain event in the future are called contingent goods. 29. We had purchased 100 Electrodes @ Rs 20/- Each. After a year we found 2 Electrodes is missing by physical Count. My Question is what journal entry we should pass against missing of 2 electrodes. PURCHASE ACCOUNT DR 2000 TO PARTY ACCOUNT 2000 ( BENING PURCHASE ELECTROESD BY ....) PARTY ACCOUNT DR 40 TO PURCHASE A/C 40 ( BEING SHORT ELECTROD 20*2) 30. What is Amortisation? What is the difference between depreciation and amortisation? Amortisation means loss in the value of intangible assets like patents ,good will. Depreciation means loss in value of assets like land and building,furniture,machiery 31. goods sold to mr x of rs5000/-,out of that we give him discount allowed of rs 500/-,and we take setting charges of rs1000/-.so what will be the entry? party A/C ...... Dr 5500 Discount A/C ..... Dr 500 to sales A/C 5000 to Setting charges 1000 32. What will be the general entry for advance salary given? Salary Advance A/c ...............dr To Bank A/c When Adjusting of salary advance. salary A/c.............dr To Salary advance A/c. 33. what is the examples of direct income Direct income is the income which is earned directly to do his business or services provided. E.g:- Salaries, Professional fees etc. 34. What will be the general entry for purchase return? What will be the general entry for sales return? Creditor A/C ............. Dr to purchases return Sales return A/C ............. Dr to debtor A/C 35. formula for capital turnover ratio? Total Capital Turnover Ratio = Net Sales/Capital Employed 36. what is accrual concept? cost Recognized and when the incurred and not when paid or received. 37. why capital is a liability ? it is an amount invested by the propraitor to start a busines.As per accounting entity concept the owner and the firm has seperate entity.so it shold be treated as a loan given by him.Hence in companies point of view,it has the liability to repay the amount in future.so capital is a liability. 38. if goods purchased from x company for rs1000 in credit,out of that 10% given discount for us what is the entry in tally? purchase a-dr, to,discount receiveda, to,party name a. 39. what are different types of invoice? in case of manufacturing concerns purchase invoice, salesinvoice, excise invoice, commercial invoice, import and export invoice 40. what is the order in preparing the balance sheet, placing of assets Assets are arranged in the reverse or descending order of liquidity. I.e the least liquid assets are listed first & the most liquid assets follow down. Exceptions are Deferred Revenue Expenditure, Pre-Operative Expenditure, Preliminary Expenditure, etc. under Miscellaneous Expenditure, to be charged off over a reasonable period of time (More than one accounting period) and Debit Balance in the Profit & Loss A/c (i.e. Carried Forward Loss), since these are not real assets. 41. why do we take preliminary expenses into asset side? Preliminary Expenditure - is shown under Miscellaneous Expenditure (To the Extent Not Written off of Adjusted) on the Assets side or under Application of Funds in the Balance Sheet. It represents the amounts spent on getting the company formed & registered & the benefits of this is spread over the life of the company. If this is charged to the Profit & loss Account in the year when it's incurred, True Profit/Loss is not arrived at for that year, as the expenses are overstated. In order to even this effect, the expenditure is written of over a reasonable period of time (Eg. 5 yrs. or 10 years). Since it is in the nature of an intangible asset, it will appear as an asset, till it is fully charged off to Profit & Loss A/c. 42. What is the meaning of Central Excise and State Excise Duty & also want to know differnec between them There is only one duty that central excise duty.there is no state excise duty.But the act had given power to state government to collect duty only on alcohal,liquor and some specified products.non of these are collected by central government. 43. what ia mean by tally? Tally is one of the package which is using to prepare financial statement by accurately 44. How Many Methods of Depriciation & Which are those ?? 45. What is the Difference Between (A/c Payable / Receivable ) AND ( Bills payable / Receivable )................? 46. What is the Difference Between Expenses & Expenditure ?? Expenses means cost for doing business Activity & Expenditure means it is a promise for future payment. 47. I purchased a Car & paid 10,000/- Rs. Cash & 50000/- Rs. By Loan. What will be the Entry ?? car a/c - Rs. 60000/- Dr cash a/c - Rs. 10000/-Cr Loan a/c - Rs. 50000/-Cr 48. Where it will effect in the Balance sheet, Rs. 5000/- of Bad Dept ?? it ll effect on the asset side of the balance sheet,and shd b deducted form the debtors 49. Furniture is Destroyed in Fire ?? Where it will effect in Balance sheet ? Debit quot;
Exp. & Revenue Summary A/c Credit quot;
Furniture A/cquot;
 Effect on Balance Sheet Fixed Assets decreases (Assets Side) Retained Earning decreases (Liabilities Side) 50. What is mean by Amortization? AMORTIZATION IS THE PROCCESING OF WRITING OF INTENGIBLE ASSETS. 51. What is mean by capital gain The amount by which an investment's selling price exceeds its purchase price 52. What is mean by deferred revenue expenditure? Deferred revenue expenditures are those create any assets and there benefits spread in more than expenditures which have been incurred in an accounting period and they do not one accounting period Ex Advertisement etc... and it is debited to Deferred expenditure account in the non current assets area of your chart account. 53 what is the reason for finding breakeven point? BEP IS THE POINT WHERE NO PROFIT NO LOSS FOR A FIRM. SO TO TAKE ANY DECESION IT SHOULD BE MEASURED.AND IT IS THE MOST CRUCIAL STEP TO SETTING UP NEW TARGETS 54. Difference between Provisions and reserves? Provisions generally done against the expenses whereas reserve is related to surplus of funds with in organisation. 55. What is personal account? These accounts show the transaction with customers, suppliers and the Bank and the Owners. A business may have any credit transactions with the other firm Example: purchase goods from Rahul with cash amount = 10000/- 56. what are profitability ratios? profi/sale*100 profitablity ratios are mainly two types. 1.profitablity as related to sales Gross profit ratio,Net profit Ratio,Operating profit Ratio. 2.Profitability as realted to investments Return on capital employed, Return on Equity funds. With the help of this ratio we can judge the managerial efficiency which may not be reflected in net profit ratio. 57. what is sox? SOX - Sarbanes–Oxley Act made by us congress in 2002 to protect the investors interest.. 58. what is the difference between cash flow statement and fund flow statement.. The main differences are as follows:1A cashflow statement is concerned only with the change in cash position while a fund flow analysis/statement is concerned the change in working capital position... 59. what are contingent liabilities? ontingent liabilities are those liabilities which become payable on the happening of the an event. in case, the event does not take place or happens, no amount is payable. such liabilities are not shown in the balance sheet but these are revealed by note. examples liabilities in respect of bills disputed claims guarantee for loan, etc. 60. How tha valuation of Inventory should be done? Inventory should be valued at Cost or Market value whichever is lower. This is based on the principle of conservatism. It's also expressed as 'Lower of cost or realizable value'. 61. how to make budgeting ? BUDGETING SHOULD BE BASED ON PAST PERFORMANCE, EXPECTED REQUIREMENT IN FUTURE,RESOURCES AVAILABLE AND ALSO ACCORDING TO FUTURE PLANS 62. Entry for cheque bounce Dr. ------------------Bank A/c Cr. ------------------------------ Party A/c just a reverse workin of payment voucher and in case of Receipt the cheque Dr. ---------------- Party A/c Cr. ---------------- ----------- Bank A/c 63. re paid expense is a asset? where it should be posted yes,is is a asset ,it would posted under the head current assets. 64. WHAT IS SERVICE TAX The service tax is an one of the indirect tax which was paid by public to the govt through the services recieved by them on specified services. Bills paid for transportation or air travels, bill paid to service engineer, telephone services etc are come under authorities to collect service tax from the payer. 65. HOW PASS A TDS DUE ENTRY when Salary Due: salary a/c dr 30000 To salary payable 25000 To tds 5000 (for due) When Payments of Salary salary payable a/c Dr. 25000 tds a/c Dr. 5000 To cash 30000 66. What is C & F Activity ? THE TERM C&F MEANS COST AND FREIGHT , WHENEVER THE COMPANY PUCHASE THE GOODS IT WILL HAVE CERTAIN TERM AND CONDITION LIKE EX-OUR FACTORY,ETC, THE TERM C&F SIMPLY MEANS GOODS ARE DELIVERED AT OUR FACTORY INCLUDE FREIGHT OF THE PRODUCT. 67. what is the balance sheet? And also tell me about the finanacial statement? Balance sheet is the statement which shows financial position of the company which tell us whether comapany have sufficient assets to bear its long term as well as long term liabilities. 68. what is the golden rules of accounting personal a/c:debit the reciver credit the giver Real a/c:Debit what comes in credit what goes out Nominal a/c:Debit all expenses and losess credit all incomes and gains. 70. goods lost by fire rs10000 & insurance claim received for the same rs8000.what are the effect of this entry in final accounts? trial balance cr side goods lostt by fire 10000. profit and los account dr side loss on goods lost by fire 2000. balance sheets asset side insurance claim 8000. 71. What is the full form of EDLI?(related to EPF...) Employee Deposit Linked Insurance 72 How do caculate goodwill of a company? goodwill is an asset of a company which shows the name and fame of a company in the market it can calculate under three methods capitalisation method , super profit method and annuity method. mostly company's will follow capitalisation and super profit method 73. what is accural accural means adjustments in final account is also adjusted to get fair value of financial statement on a particular period of time.there are of two types of accounting accural basis or cash basis but accural basis is basically followed in every sphere of accounting this concept says we don't only cash but also prepaid or outstanding transaction as well. 74. On goods purchases of Rs.2,00,000 got trade discount of 20,000 from supplier, and the amounts paid to supplier is 1,00,000 in cash and RS.1,00,000 in check on the same day, what would be the general ledger entry ? Trade Discount Will not come in the books account ,but cash discount will come in the books of accounts . so here is trade discount........... Purchse a/c dr 200000 To Cash 100000 To Bank 100000 75. lease tell me under which heads following ledgers should open or create. 1.Vat on Sales 2.Vat on Purchases 3.Excise on Sales 4.Excise on Purchases 5.Service Tax Input 6.Service Tax Output DUTIES&TAXES UNDER THIS HEAD THE LEDGERS CAN BE OPEN OR CREATE. 76. HOW TO POST THE GENERAL ENTRY OF DEPRECIATION ON FURNITURE IN ACCOUNTING SOFTWARE FOCUS Depreication a/c Dr. To Furniture a/c cr. 77. what is suspense account? When information is not clear or complete to identify a transaction with a particular account, it can be parked in an account called 'Suspense Account'. Once the necessary information is received, journal entry needs to be passed to transfer the effect to the current account. All the transactions in this account should be transferred to the correct accounts before preparing the Final Accounts Suspense A/c is an account to park the transactions till they are identified to the correct a/c. 78. he jouranl entry of purchage of fixed assets are assents a/c dr. to cash/bank account why we not make journal entry for this is purchage a/c dr. to cash/bank First of all, the nature of two accounts is different. Fixed asset a/c is a real account whereas Purchase a/c is a nominal account. 79. what the entry for Accumulated Deprecation?? Depreciation A/c Dr... To Accumulated Deprecition A/c 80. The Actual Rent was 12000,in the month of Feb i had paid 15000 and in the month of march i had paid 3000. Pass the necessary Journal entry for this. For the month of Feb Rent A/c 12000/- Prepaid Rent A/c 3000/- To Bank/CashA/c 15000/- For the month of march Rent A/c 12000/- To Prepaid Rent A/c 3000/- To Bank/Cash A/c 3000/- To Rent Payable A/c 6000/- 81. What is the entry for Discount Received? & What is the entry for discount paid? discount recieved is an income so it should be credited. discount allowed is an exp so it should be debited so here discount received: party(creditors) a/c......dr to discount received to cash/bank DISCOUNT ALLWED CASH/BANK A/C...............DR DISCOUNT ALLOWED A/C.........DR TO PARTY 82. How we can transfer stock from our punjab firm to our chandigarh firm if you want to stock transfer to your branch offices out of states then you have to submit F-forms for stock transfer 83. if a employee basic salary is rs. 8000/- in march 2010 his total days of salary is 15 then what will amt comes in his f.p.f.(8.33%) account 8000 divided 31days multiply into 15 = 3,871 3,871 * 8.33 % = 322.45 So, f.p.f amount is 322.45 84. WHAT IS LIABILITY? Liability means- : company's legal debts or obligations that arise during the course of business operations . It include loans, accounts payable, mortgages, deferred revenues and accrued expenses and always show in balance sheet (right side) liabilites are diviede into two parts, 1 Current liabilty 2 Long Liabilty Current liabilities means those debts payable within one year while long-term liabilities are debts payable over a longer period. A balance sheet item which equals the sum of all money owed by a company and due within one year. also called payables or current debt. 85. What is accrual concept? As per Accrual Concept of Accounting Expenses & Revenues are accounted in the accounting period to which it relates(accounted in the year of accrual)and not when the same is paid or received. As against Accrual concept, expenses and incomes are accounted when they are settled by making payment between the parties to the transaction. 86. what is the journal entry for cheque dishonour by party name a/c dr to bank a/c cr just opposit entry of re 87. what is enty of income tax paid by company.& what is group of income tax paid. Taxes & duties a/c Dr To bank/cash A/c 88. what are all the items comes under balancesheet(liability side & asset side) step by step.& also trading and p&l account. somany companies asking this type of question please tell me... . alance sheet as on........ liabilities assets 1.share capital 1.fixed assets equity good will preferance land and buildings etc 2.reserves and surplus 2.investments 3.secured loans 3.current assets 4.unsecured loans debtors closing stock 5.current liabilities 4.miscellaneous exp creditors bills payable bank overdraft 89. why current ratio is 2:1.why it is not 100:1,10:1,20:1 in current ratio. please tell me....? if the current ratio is 2:1, company position is good. it says that company consist of 2 assets for each liability to clear its debts. if current ration is like 100:1,10:1,20:1 tells that over assets hold by the company. its not good at all. then company has to face the problems. 90. what is an assets? . Any item of economic value owned by an individual or corporation, especially that which could be converted to cash. Examples are cash, securities, accounts receivable, inventory, office equipment, real estate, a car, and other property. A balance sheet item representing what a firm owns. On a balance sheet, assets are equal to the sum of liabilities, common stock, preferred stock, and retained earnings. From an accounting perspective, assets are divided into the following categories: current assets (cash and other liquid items), long-term assets (real estate, plant, equipment), prepaid and deferred assets (expenditures for future costs such as insurance, rent, interest), and intangible assets (trademarks, patents, copyrights, goodwill). 91. What is Contra entry Any item of economic value owned by an individual or corporation, especially that which could be converted to cash. Examples are cash, securities, accounts receivable, inventory, office equipment, real estate, a car, and other property. A balance sheet item representing what a firm owns. On a balance sheet, assets are equal to the sum of liabilities, common stock, preferred stock, and retained earnings. From an accounting perspective, assets are divided into the following categories: current assets (cash and other liquid items), long-term assets (real estate, plant, equipment), prepaid and deferred assets (expenditures for future costs such as insurance, rent, interest), and intangible assets (trademarks, patents, copyrights, goodwill). .92. In sales entry, for sales tax what rule apples (real, nominal) Nominal Because sales tax is Expenses and refering to the rules by Nominal Debits are all expenses and losses 93. Sales A/C belongs to which account type? Nominal account because any profit or gain or expenses or losses will come under nominal account 94. In what circumstance month end liability wil increase ? when we do not pay monthly revenue expenditure, by the effect of this liabilities will increase. for example - outstanding wage or salary 95. Computer value 5000, Deprecation 3000, Book vale 2000, Sold for 2000 Pass entry? Deprecation A/c 3000 cash/Bank A/c 2000 To Computer A/c 5000 96. What is ERS(Evaluated Receipt Settlement) in Accounts Payable? How is it related to 2 way matching? Evaluated Receipt Settlement (ERS) is a methodology that eliminates the supplier invoice from the procurement-to- disbursement process. It is also called auto-payment, and utilized a two-way rather than a three-way match. It is most commonly used in the manufacturing industry between established trading partners. In an ERS transaction, the supplier issues an advanced shipping notice (ASN) based on a purchase order or contract from the purchaser, then ships the goods. The purchaser, upon receipt of the shipment, confirms it against the purchase order, verifies the items and quantity and pays the supplier. Fundamentally ERS determines disbursements based on purchase orders and receiving information. ... 97. what is the meaning of single entery system and double entery system ? double entry -- a method of bookkeeping in which there are two entries for each transaction, one as a debit and the other as a credit, that check and balance each other single entry -- a method of bookkeeping in which each transaction is entered only once on the account books 98. what is rettification of error? Error mean mistake. If you are prepared accounts, the mistake will come journal, ledger & trailbalance. First we are identified the mistake and that mistake adjusted or recitified. For example: Purchases goods for cash Rs 1000/- The journal entry is Purchase A/c ...Dr 1000 To cash A/c 1000 But posting in the ledger accounts, we are posted in Purchase a/c only 100/-. the 900/- is missed in purchases a/c. like this type of errors, rectified called as recitfication of errors. 99. what is deprisiation?what is upprisiation?what is bill receable and payable Depreciation means decrease the value of an assets for its use in the business. Appreciation means increase the value of an assets. bills recievable means a document evidence the amount by the business to the debtors. bills payable means a document evidence the amount owes by the business to creditors. 100. what is direct expensive? direct expenses are those expenses which are directly spent to convert the raw material/goods into finished/final product. Eg:Factory Lighting & Heating. Wages(given to Factory Labours) etc... 101. what is the direct taxes? Direct Tax imposed on the assessee on the direct income. when the assessee make the transaction directly and pay the tax on the spot. 102. What is different between cash accounting & Mercantile Accounting ? Only cash based transactions considered to arrive profit / loss of a F.Y. irrespective of the transaction belongs to either previous year or the following year. In Mercantile system transactions belongs to the current year only considered to arrive profit / loss of the F.Y. whether the transaction is cash based or credit based. All companies follow mercantile system only. 103. What is the entry for bad debts recovered cash a/c dr To bad debts recovered a/c 104. whom can deduct the TDS? any one can deduct tds it may be company firm or individual. if any of the above is using any services or paying any kind of interest, commission or rent, then he/she/it is liable to deduct tds as per the current rate, it also depand on the liabilitie of the tds deduction 105. what are the supporting documents of expenses? VOUCHER OR ANY DOCUMENTS RELATED TO EXPENSES ARE IN WRITTEN DOCUMENTS 106. in bank statement what is the tras date? and value date? what is the difference? xample If we deposit a cheque of Rs. 2000 in bank on 06.02.2010 this is the Transaction date on which we deposited cheque but the bank will pass our cheque on 08.02.2010 and transfer Rs. 2000 in our account. this is the 08.02.2010 value date when bank can give value to our transaction. Trasaction date is a trade date that means you are entering any transaction. & value date is settlement date 107. what is ledger Ledger is an accounting book of final entry where transactions are listed in separate accounts. 108. wahat is the journal entry for cheque paid for collection but not collected? firm enters only quot;
sent for collection ie.bank A/C Dr To cash 109. what is MIS report we prepare it? MIS(MANAGAMENT INORMATION SYSTEM) IT MEANS GATHER THE INFORMATION FROM VARIOUS DEPARTMENTS IN AN ORGANISATION LIKE SALES,PURCHASE....ETC) WITH THAE INFORMTION THE MGT OF ORGANISATION MADE A PROPER PLANING , DECISION MAKING IN THE PREPARATIN OF BUDGET 110. wahat is the journal entry for cheque paid for collection but not collected? firm enters only quot;
sent for collection ie.bank A/C Dr To cash 111. how to make conversions from tally to ms excel sheet like profit & loss a/c and balance sheet & trial balance U can export the details from tally to ms excel. 112. During the Interview in a Company the Interviewer asked me that Why the Depreciation Rate as per Income Tax Act & Companies Tax Act differs, please answer this quetion ? Depreciation will calculate below 180 days & above 180 days as per Income Tax Act & As per Companies Act will calculate daily basis.... 113. work in progress for a construction company this year is Rs.5,00,000/-.In balance sheet Rs.5,00,000/- will be debited under current asset a/c but the credit would under which account.and next year what will be the entry.please answer me in detail up to next year this work is not completed opening balance of work in progress next year balance sheet.or suppose the particular work completed the entry was passed total amount of work in progress debit to particular building any other credit the work in progress 114. In Balance Sheet Why we entered Liabilites & Incomes under Liabilites side , Assets & Expenditures under Assets side.In general think incomes are asssets,expenditures are liabilites. Who told you expenditure will be placed under assets side. Expenditures will be be deducted from revenue and income or loss will be arrived. Profit will be added to capital and losses will be deducted from capital account. you know pretty well that capital account will be placed under liabilitieds side. You simply note down that expenses or incomes will not find place in balance sheet 115. How can we explain what is an asset, consumable, stock, store item ? What are the essential differences Asset: Asset means which bought for the purpose of carrying the business in the terms of producing the goods not for the purpose of resale. Consumable: consumable means the products which required for producing goods, Like raw materials ets. Stock means the goods which have been produced and are readily available for sale. it may opening stock or closing stock. Note: It may include raw materials but need to specify depending on the situation. 116. Distinguish between capital expenditure & revenue expenditure cap exp means expenditure on items for long term basis and 117. revenue expenditure is the expenditure on items used on daily basis What is the rate of claiming Input service tax i.e 20% or 100% o 20% 118. What is Account receivable & Account payable ? Account Receivable is the receivable from the parties against the services & goods provided to them, , & similarly the amount payable is amount to be paid to the Party against the service or goods received from them. 119. what is the differece between salary and remuneration? salary is fixed by the organisation for the various levels of the organisation , for ex, govt. and quasi govt. organisation . no deviations are allowed at any level. full revision only possible. remunaration is the amount one can claim or one has to give for the value of service extracted or rendered. one salaried person may not be remunerated properly. remunaration is bargainable. understand the mild difference 120. I would like to know about work in progress, when we will debit WIP under Asset a/c head in balance sheet, the credit will be allocated under in which accounting head? whether its under purchase a/c or income a/c ? expecting detail explanation? WIP is closing stock that why it is reflecting assets next effect will on trading account credit sidt 121. what is SEC,BED SEC means Section BED means Basic Excise Duty SEC stands for Security & Exchange Commission. BED = Better Equipment Donation. 122. when we file Vat audit report 28 th jan of next year 123. Discount payble and reciveble entries what type of vochars entry pleas tell............... jounal entries 124. What do you mean by prepration of Balance sheet? how to explain this with example, please tell me if anybody knows this. Balance sheet is prepared to know the Financial Position of a company........ 125. WINDOWS SOFTWARE PURCHASES FROM MICROSOFT BY PAYING A CHEQUE OF RS. 35000/- FROM AXIS BANK LTD. PASS THIS JOURNAL ENTERY 1)Asset Booked Thrg JV Software (Asset)A/c Dr 35000 Micro soft A/c CR 35000 2)Payment entry to party Micro Soft Dr 35000 Axix bank Cr 35000 126. what is liability liability is the present obligation of the entity 127. what is amortization? the gradual reduction of an intangible fixed assets is called amortization 128. Which type of stock show in trail balance. Op. Stock or Cl. Stock & Why? In trail Balance only the opening stock we will show and the clsoing stock may not be showing because by the time exact monetary value may not be known. 129. What is meaning of Corporate Assessee & Non Corporate Assessee? Corporate Market & Non Corporate Market? Under Income Tax Act., Companies registered under the Companies Act, are called corporate assessees and all others (Individuals, Trusts, Firms, NGOs, Charitable Institutions, etc) are called Non-Corporate assessees. Corporation also means company, so in other words, corporate assessee means company assessee. 130. what do you mean by dual aspect of accounting? Dual Aspect of Accounting means that every transaction that take place has two aspects one is debit & another is credit & because of dual aspect of a transaction asset side of Balance sheet matches with Liabilities side. The Accounting equation is : Liabilities + Capital= Assets A dual aspect transaction will impact the asset & liabilities & accounting equation as follows : 1. Increse in Assets & Increase in Liabilities. 2. Decrease in Assets & decrease in Liabilities. 3. Increase in one Assets & Decrease in another Assets. 4. Increse in one type of liability & decrease in another type of Liabilities. 5. Increse in Assets & Increase in Capital. 6. Decrease in Assets & decrease in Capital . Here this equation get balanced after every transaction. For exp : There is a purchase of Furniture on Credit for Rupees 10000/- In this case Asset side will increase by Rs 10000 & the same time liabilities will also increase by Rs 10000. And Hence accounting eq. get balanced because of dual aspect of transaction. The Same way other transaction will affect the accounting equation as specified in the above six points 131. My question is- are tpt,freight & p & f charges part of sales & purchase when it include in invoice. suppose if goods value 20000 freight chrg 425.00 total sales will be 20425 or only 20000.00 how it will effect ?? pls clear The total sales will be of Rs. 20425 and the entry will be Cash Dr. Rs. 20425 To Goods A/c Cr. Rs. 20000 To Freight A/c Cr. Rs. 425 132. Balance Sheet comes under which account? a)personal a/c, b) real a/c, c) nominal a/c BALANCE SHEET DOESN'T COME UNDER ANY ACCOUNT. IT IS ONLY THE PRESENTATION OF THE BALANCES OF THE ASSETS & LIABILITY.& THE TOTAL OF THE BALANCES(DR.& CR.) MUST BE TALLIED. 133. CHEQUE ISSUED TO ABC 20000 & DISSOUNT RECEIVE 2000 , THE CHEQUE DISSONORED, WHAT ENTERY THIS TRANSACTION If cheque was dissonored, the party ABC account is credited by RS.22,000 and bank account is debited by RS.20,000 and also discount received account is debited by Rs.2,000 134. There are 7 types of taxes that are paid for by an individual.1. Income Taxes: These taxes are paid out by anyone who earns an income by any means. April 15th is the day that income tax filings are due in the United States, and anyone earning income needs. Income taxes are subject to deductions and tax credits; they are usually not paid by people under a certain income or who have special situations such as a disability. 2. Property Taxes: These are paid by anyone who owns property such as land, a home or commercial real estate. These taxes are often collected by the state and county to help fund their budgets. While income taxes are subject to deductions or credits, these taxes are often fairly rigid. Licensing fees on cars, recreational vehicles and watercraft are property taxes as well. 3. Consumptive Taxes: These are taxes on sales goods or items that are subjected to being used by either an individual or business. While everyone understands that a small amount of money is added on to the purchase of goods in the stores, many people overlook other taxes. A fishing or hunting licesnse is a tax. Toll road fees are a tax, even if they call it a user fee. So are travel fees. 4. Corporate Taxes: All business structures pay taxes on the income made in that particular business. Tax consequences are important when structuring a business. For example, sole proprietorships will pay their taxes through their regular income taxes, while a S-corporation pays quite differently. An C-corporation is best held by shareholders because of tax implications. Of all of the seven types of taxes, this one is usually the one that requires the use of a professional to figure out the complicated tax requirements. 5. Payroll Taxes: These taxes are taken out by the businesses before income is distributed to the individual in exchange for the work that was done. These are commonly called quot;
FUDAquot;
and quot;
FICAquot;
and businesses need to match a certain amount of these payroll taxes. This is an additional cost of having an employee, and one reason why quot;
independant contractorsquot;
have become so popular. These payroll taxes must be paid by the individual contractor if the regular business is not paying them. quot;
FUDAquot;
and quot;
FICAquot;
fund social security and other similar programs. 6. Capital Gains taxes are paid on investments that have appreciated. Frequently these investments have been sold. Examples would be stocks, bonds, and real estate. Most losses can be quot;
written offquot;
on the federal income tax level, and like corporate taxes, these are usually best handled by professional tax preparers. 7. Inheritance or Estate Taxes: Of the 7 types of taxes, this is the only type where a tax can happen because of a death. A certain amount of estate money that may be passed on with no tax consequence. Once that level is met, however, the taxes are usually quite steep. Life insurance is often used to offset inheritance taxes, and is one reason insurance is so critical in estate planning. 135. What is Cash Flow Statement? Cash Flow Statement is that statement which represents the net inflow & outflow of cash in a particular period. 136. WHAT IS MAXIMUM LIMIT OF CASH PAYMENT PER DAY BY A COMPANY? Maximum cash payment by a company to others is Rs. 20,000/- but if you pay cash to Govt department you pay more then 20,000/-. 137. cash a/c dr To bad debts recovered a/c 138. purchasing of software more than Rs.8000/- will be treated as expense or assets as per company need.buy software is an assets for your company of taking as 60%WDV deprication 139. what is Contra Asset? Cash Asset 140. What is revenue for Insurance Company? revenue comes from premium payment and invest in equity market and taking charges like:-FMC,Mortality charges, et 141. what is different between LC's and BG's Practically, latter of credit is a document indicating creditworthyness of importer to make payment to exporter wherein importer's bank gives a guarantee to exporter that in case of any abnormality, if importer fails to make payment then bank will do the same. While in case of BG bank gives a guarantee to their client that in case of non performance of the job by contractor, client can encash the BG from bank. By are of 3types. Advance, security & performance. 142. sale tax which place effected Dr sales tax a/c Cr. provision for sales tax when paid Dr provision for sales tax Cr. cash or bank 143. On 01-04-2006 Mr. Dhanpal started business with Rs.2,00,000 cash and opened a bank account with Rs.1,50,000. He purchased furniture for his business for Rs.25,000. Goods were bought from Deendayal for Rs.50,000 on credit. He sold goods for Rs.27,000 in cash and 30,000 on credit. He paid Rs. 2,500 for business expenses during April month. Rs. 10,000 was withdrawn for office purposes from the bank. Find out the closing balance of cash and bank. cash ac dr. =200000 to ccapital a/c= 200000 bank a/c dr......150000 to cash a/c.............150000 if u bought furniture purchase in cash furniture a/c dr......25000 to cash ......................25000 cash a/c dr.......27000 to sales................27000 if expenses paid in cash expenses a/c dr........2500 to cash ....................2500 cash a/c dr........10000 to bank...................10000 so dear cash and bank closing balance is cash balance (200000-150000-25000+27000-2500+10000) =59500 rs bank balance (150000-10000)=140000 cash balance is 59500 and bank balance is 140000 ok dear arju 1-4-2006 cash/c-----dr 2,00,000 to capitala/c 2,00,000 bank a/c----dr 1,50,000 to cash a/c 1,50,000 furniture a/c----dr 25,000 to cash a/c 25,000 purcheses a/c------dr 50,000 to deendayal a/c 50,000 cash a/c------dr 27,000 to goods a/c 27,000 sales a/c--------dr 30,000 to goods a/c 30,000 business exp a/c-------dr 2,500 to cash a/c 2,500 cash a/c--------dr 10,000 to bank a/c 10,000 ledger cash a/c dr cr to capital 2,00,000 by bank 1,50,000 to goods 27,000 by fur 25,000 to bank 10,000 by exp 2,500 by bal c/d 59,500 total; 2,37,000 total; 2,37,000 bank a/c dr cr to cash 1,50,000 by bank 10,000 by bal c/d 1,40,000 total; 1,50,000 total; 1,50,000 therefor the final closing balance of cash 59,500 and bank 1,40,000 145. we calculate appreciation for asset what is it? A Company can have an asset revaluation policy & can value its long term assets periodically. Revaluation can result in either increase or decrease in the value of the asset. Increase in value is 'Appreciation' & decrease in value is'Depreciation'. However the difference in the present book value of assets & the value arrived at on revaluation will be transferred to Revaluation Reserve A/c. One example of appreciation in value is that of Land. 146. what is the meaning and abservation of EBITDA Expansion of abbreviation EBITDA - Earnings Before Interest, Taxes & Depreciation Allowance. Here Taxes refer to Income Taxes. 147. What is the TDS ? what is fORM C & FORM 16A? C-Form - Certificate issued by an Interstate Dealer (Buyer of Goods/Equipments) under CST Act to another register dealer(Seller of Goods/Equipments) under CST Act. in another state on Interstate Sale & @concessional rate of tax under Central Sales Tax Act. (CST Act) Purchase transaction TDS MEANS TAX DEDUCTION AT SOURCE FORM 16A IS A TDS CERTIFICATE 148. What is the Difference among COST,PRICE and VALUE? Cost:- Cost refer to Production Cost Price:- Price include a fixed % of profit Value :- on a particular time what's the Value for that product.Example:- 100/- is production cost of scientific calculator market price is 120/- including fixed % of profit & other transaction charges, after 1 year its value is Rs/- 50 (excluding depreciation). 149. in cash transaction, above Rs.20,000/- is invalid for auditing but what if above Rs.20.000/- transaction is made & how much tax will be paid if transaction is above Rs.20,000/- Tax exemption is valid to the extent of Rs20,000 only if its is more than 20,000 tax has to be paid for whole amount. 150. Fixed Assets Depreciation Rats ? Rates & method of Depreciation are different under the Companies Act & the Income Tax in India. For rates & guidelines Refer the Companies Act (Depreciation Schedule) & the Income Tax Act. Or refer teh latest Income Tax Ready Reckoner, where rates under both the Acts are available. Rates are also available on the Internet/websites of Income Tax Department / Department of Company Affairs. 151. capital 2000000,sundry crediors 75000, building 150000 A=C+L THEN A= 150000 C=200000 L=75000 &SUSPENSE A/C 125000 275000= 200000+75000 152. How to prepare a final account The final account namely Profit and loss account and Balancesheet prepared with help of trial balance and adjusment entries 153. what is bank pass book statement bank passbook statement is history of all financial transactions of a customer account,with effecting balance of account. 154. What is the Full Form of ACCOUNT ? ACCOUNT means A = Anylsis of C = Computition and C = Captilization of an O = Organisation U = Under N = Normalized T = Transiction 155. What Do You Mean By A Business Event? any exchange of goods and services is called as business event 156. Can You Please Define Book-Keeping? Book keeping was done by actual book keeper. This person kept a company's day-to-day financial records by manually recording every business transaction into a journal. Book keeping is recording all the day to day transaction in the Book of account on daily basis. 157. Describe the procedure for computing the loss of stock by fire loss of stock by fire--------dr to trading a/c being loss accurde amount charged to trading account profit & loss a/c------------dr to loss of stock by fir being loss debited to p&l a/c 158. whether directors fees included in cost or not? if yes/no why? No.Directors fee directly will not affect cost of the company/manufacturing etc.Better to include it in P&L account exps segment. 159. what is diffarant tds and incometex. TDS is has been paid for the servies what we provide to the other party & Income tax has been paid for the income what we earn. But simlarly TDS is the part of Income tax, i.e. If a person prvide servies to a company, at end of the financial year that company gives him a TDS certificate for the payment what they made to him for his services. Since that person has only that business, while filing his income tax (Income what he earned from the business), he will also submite his TDS certificate to avail the tax benifit. Because the tax has been already deducted from his income. 160. Invoice for Rs 492650/- is inclusive of 14.5% VAT. Pl calculate Basic Rate for the material. Assuming that the Invoice value of Rs.492650/- includes the Basic Price & VAT - Basic value of the material is Rs.430262/- & VAT @14.5% is Rs.62388/-. Formula is - 492650 / 114.5 x 100 = 430262/- 492650 - 430262 or 492650 / 114.5 x 14.5 = 62388/- 161. Match the following: 1. 4. AS – 7 AS – 9 AS – 19 AS – 20 (i) (iv) Earning per Share Construction Contracts (Revised) Revenue Recognition Leases AS 7 - CONSTRUCTION CONTRACTS (REVISED) AS 9 - REVENUE RECOGNITION AS 19 - LEASES AS 20 - EARNINGS PER SHARE 162. what is the meaning of prepaid insurance and outstanding salary? please explain with example. Prepaid insurance means such insurance we have paid in advance. example If we paid rs 2500/- in f.y. 2009-10 for the peroid (01.03.10 to 01.03.11). Rs. 208 for one month will exp & (2500-208=2292)prepaid insurance because it is not related to f.y. 2009-10 outstanding salary :- we have recorded in books but payment has yet to be made. ex :- March Salary, we have booked in books but we will make payment in coming month. We will pass the entry Salary dr Salary payable cr 163. A company maintains a margin of safety of 25% on its current sales and earns a profit of Rs. 30 lakhs per annum. If the company has a profit volume (P/V) ratio of 40%, its current sales amount to A. Rs. 200 lakhs; B. Rs. 300 lakhs; C. Rs. 325 lakhs; D. None of the above. Margin of Safety = profit/(p/v)ratio = 30/.40 MOS = 75lacs 25%S = 75lacs S =75/.25 = 300lacs 164. AHT DIFF. BETWEEN TIN NO. AND CST NO.? TIN (Taxpayer Identification Number) is issued by the Commercial Taxes Department to an applicant under the VAT Act of the concerned state. CST No. (Central Sales Tax Number) is issued by the Commercial Taxes Department to an applicant under the CST Act. Both these are the Registration Numbers under the respective Acts. These abbreviations are explained only in the context of Indirect Taxation in India. 165. Define elaborately what is DIVIDEND Dividened is nothing but division of profit 166. what will be the journal entry for this transaction? purchased furniture for personal use of rupees 2000. now tell me is it business transaction or a personal transaction?? if it is business transaction it will be: drawing a/c dr. To cash a/c and if it is personal transaction there will be no entry bcoz of accounting concept. 167. calculate the closing stock: if opening stock- rs.2327620 , purchase -23519280, direct expenses-1335225, sale:- 24884412, direct income :-286371 you have to calculate closing stock this way Opening stock 2327620 purchases 23519280 total 25846900 (-)Total sales 24884412 Closing stock 962466 168. What is meant by the Ficititious Assets? A fictitious asset is an asset accounted and presented in the Balance Sheet, but has no tangible existence or realisable value, but represents actual expenditure incurred. A fictitious asset is created to account the expenses incurred but could not be charged off to the Profit& Loss A/c of the year in which they are incurred. Fictitious Assets can be amortized as soon as possible as per the GAAP applicable to the country. In other words, fictitious assets are not real assets which can be felt & seen. An example of fictitious asset is Preliminary Expenditure. 169. what is derivative? derivative is a security, which price ultimately depends upon another asset of a company e.g:a company share price depends upon it's assets. 170. what is mutualfund? it is an amount which collected from investers in small amounts and put into various markets 171. WHAT DO WE MEAN BY CURRENT ACCOUNTS SEPARATE FROM SAVINGS ACCOUNTS. Current account is to do commercial activites of a business firm.but savings account is to make transctions of an individual person. 172. HOW TO CALCULATE NAV? If investment Rs 70000 ( unit 1689.197), dividend recd.Rs.10135.18 1689.197/70000*100 = 2.413 173. Dear sir, please tell me how to calculate provident fund by employer? 12.5% TOATAL SHARE OF EMPLOYER ON BASIC SALRY 174. WHAT IS ER-1, ER-2, ER-3, ER-4, ER-5,ER-6,ER-7 ER-1 Monthly Return , ER-2 For Traders Monthely Return,ER-3 Annual Return, Er-4 Raw Meterial Details, ER-5 Service Tax Return, ER-6 Export Detail, ER-7 Annual Return 175. what is capital budgetting? capital budgtting is a process of analysing and deciding of investment on longterm projects. 176. what is impairement? the term to write the intangigle assets is amortistion.an intangible assets with finite useful shall be amotised and intangible assets with infinite useful should be impaired and not amortised. for eg goodwill should be impaired butshould not be amortised treatment:its a non cash expense so it should be charged against the income 177. what is the differance bet ween Bill and invoice? Bills are maintained by retailers where as Invoices are made by manufacturers and wholesalers. 178. Is closing stock will recorded in Trail balance? Closing stock will not be recorded in Trail balance it will be shown as adjustment 179. hat will i do to remove my fear in interviewee? First of all take the things easy. Be cool, calm and composed. Always think that this is not the last opportunity or end of life. Secondly, do you home work. Write a script of all the expected questions which might be asked by interviewer. Third, Body language and eye contact with the interviewer should be confident and positive. Fourth, show positive attitude. 180. what is Debit note and Credit Note ? When purchase returns occurred, Debit note will be issued. When sales returns occurred, Credit note will be issued.. 181. Give Example for Intangible assets that is depreciable? Charging off intangible assets to P&L A/c is called amortization. It's similar to charging off Depreciation on Fixed (Tangible) Assets. Patents, Copy Rights, Goodwill, etc. are some of the example. Even Preliminary Expenditure is an intangible asset and is charged of to P&L A/c of more than one Accounting year (5yrs., 10yrs., etc.) 182. what is vendor account group Usually, company use different Vendor group for different categories of vendor. Each group can be separated as regular or irregualr vendors or one-time vendors. 183. How Many Type's of Cheques? with explanation and Examples? bearer chek, cross chek ,and bounce chek 184. i given 20000 amount to some one in a company but the travelling expendeture only 8000 the person who had taken the 20000 given all his expendeture for 8000 how to make an entry in the books of tally. please advice We can show combined entry in Payment Voucher as given below:- we use for unknown or that person name 'X' and DR. travelling expenditure A/c ....... 8000.00 DR. ADVANCE A/c ....... 12000.00 CR. X A/c ................. 20000.00 And also we can show single entry in pmt. voucher:- 1. Dr. travelling expenditure A.c ...... 8000.00 Cr. X A.c .............. 8000.00 2. Dr. Advance A.c ........ 12000.00 Cr. X A.c .................. 12000.00 185. Is the Opening Stok and Closing stock both will appear in the trial balance ? No. Only the Opening Stock is shown in the Trial Balance & Not the Closing Stock. Closing stock is taken in the Profit& Loss A/c & Balance Sheet directly. 186. what are the financial reports to be accompanied with income tax return of a business concern? Balance Sheet, Profit & Loss A/c, With Schedules & Audit Report, Income Tax Computation & Tax Audit Report. 187. what you mean by landed cost? Landed Cost of a Rawmaterial is COst From The Place of Manufactured Centre to a required Area,It Includes Basic rate of material,Exicse Duty,Vat/CST,Packing & forwarding Charges,Transportation Charges,Insurance. 188. what is excice duty and where is applicable Excise duty is a duty on manufacture, The general rate is 16% + 2 % education cess However it changes acc to the classification of the goods, check the CENTRAL EXCISE TARIFF ACT for the rate for pharmaceutical products 189. accrued income That types of Income which is earned Financial year but not recevied in this year. 190. Which types of assets deducts in equity funds for company? realisation expence. discount on debentrue. discount on share. Misanelaus expence. 191. hat is RTGS? what is the maximum limit of amount stipulation for RTGS transaction? it is a system of fund transfer machanism where transfer of money takes place from one bank to another on a ral time and on gross bases. this is the fastest possible money transfer system through the banking channel. settlement in real time meansquot;
Payment transaction is not subjected to any process of waiting period . the Transactions are setteled on soon as they are they are processed quot;
gross settlementquot;
on one to one bases without bunching with any other transaction considering that money transfer takes place in the books of the reserve bank of india, the payment is taken as final & irrevocable. RTGS is primarily for the large value transsaction.The minimum to be remitted through RTGS is One lack 192. whether baddebts can be charged for sundry creditors Sundry Debtors & Sundry Creditors are two different groups in Accounts & the former represents assets & the latter liabilities. Bad debts should be charged of the Profit & Loss A/c of the relevant period and can not be adjusted against sundry creditors. However if the debtor from whom money is receivable fails to pay and it becomes bad debt ; Same debtor has supplied some goods or provided services and the company owes him the money, then the bad debt can be set-off against the money payable to the same party under Sundry Debtors towards the goods or services received. 193. Difference between Depreciation and amortisation? Both Depreciation & Amortization are the method of charging of the investments in long term assets over the life of the assets. The term Depreciation is used for Tangible Assets (Like Building, machinery, Furniture, Computers, etc.) & the term Amortization is used for Intangible Assets (Like Patents, Copy Rights, Goodwill, etc.) The term amortization is also used in the context of repayment of term loan. The loan repayment schedule is sometimes referred to as 'Loan Amortization Schedule'. 194. eps,ROA,AMORTIZATION,DIFFERENCE BETWEEN GROSS PROFIT AND NET PROFIT, eps stands for earning per share howmuch we earn per share roa means return on assets i.e. after utilising assets how much we are earning and gross profit means profit from trading activities only and net profit means after calculating all expenses and income relating to our business activities we earn net profit. 195. what type of invoices used in small companies-for the process of accounts receivable. Genrally Tax Invoice used 196. which are coming under direct exp All the expenses related to the manufacturing, factory related is under direct exp. wages. carrige inwars etc 197. what is the diff between CASH CREDIT limit & margin. Cash Credit Limit is the limit what the banks issue to companies/firms against hypothecation of stock/debtors etc. to meet the financial requirements. for example : Total debtors/Stock = 100% Less Margin 25%(as per banks term & conditions) Net balance =75% (Cash Credit Limit) 198. what is npa & what are the different types of NPA? NPA - Non Performing Assets(In Banks). It's expressed as net NPA & Gross NPA. It's like bad debts. 199. what is p/l appropriation a/c? P/L appropriation account is made after p&l account is over in which we make the provision of genral reserve, proposed dividend, corporate tax and DTL/DTA. and balance of P&l Appropriation account is transfer to B/s. Don’t forget that the appropriation account forms part of the accounting system so the dual aspect concept applies to it. 200. Why should balance sheet always get tallied ? bakance sheet shuld always get tallied as we follow double entry book keeping system &according to it every Dr. should have corresponding Cr. & until balnce sheet dont get tallied it dont show the proper financial picture of the company or a person. 201. What is sales against E-1 Format, and wht are other forms of sales in a company ?? E1 transaction mean - Direct supply to our out of state customer from our supplier , and there are Form C , Form H and Form D And Form E11 in a company 202. OBJECTIVES OF ACCOUNTING ? recording classifying and analysing 203. What is a zero debt company? A Zero debt company is one which has not borrowed any money from banks, financial institutions or others for long or medium term requirements or for working capital. Since there's no debt, the company will have no commitment for repayment or servicing of interest. In the present world, Zero Debt Company is a rare scenario. Zero Debt. concept is not related to Sundry Debtors or receivables in a company. 204. what is differed revenue Revenue that is considered a liability until it becomes relevant to the business at hand, such as a payment received for work that has not yet been performed. opposite of deferred charge. 205. what is accounts receivable and accounts payable and how to use accounts receivable and accounts payable? Accounts payble and accounts recievable are the credit purchases and credit sales which has to collect and pay the amount further. The register was maitained for accounts payable and recievable called accounts payble register and accounts payble reigster which indicate due date and over due by days which will make easy to collect or pay the bills 206. please tell defination of goodwil and copyright? Goodwill is an intangible asset of the company. Otherwise we can call it as the name and fame of the company in th market. For example TaTa, Birla, Bajaj,Reliance. We can easily buy the products of the above companies without hesitation. That means the above are having that much of goodwill in the market. 207 what are the basic accounting entreis ? debit receiver credit giver debit what comes in credit what goes out debit expenses or losses credit incomes or gains 208. Who can issue form H, & why it is required? A company who purchase the goods from outside the state & purchase the goods for used in Export Purpose issue H Form agaisnt 0% rate of tax (means CST nil) Along with Copy of Bill of lading. only a export company issue a H Form. 209. what is trail balance ? It is a statement showing closing debit and credit balances of all ledger in double entry book keeping, purpose to test equality in balances. 210. HOW WE ENTER PF AND ESI IN TALLY AND OTHER ACCOUNTING SOFTWARE To account the PF & ESI in tally we have to pass below entry Salary a/c Dr xxx To ESI recd. Cr xxx TO PF Recd. Cr xxx To Cash or Bank a/c Cr xxx (Being salary paid for the month of xxx) (Create Salary a/c as expense, ESI & PF a/c as liability) At the time of PF & ESI payment to Govt. ESI Recd. a/c Dr xxx PF Red. a/c Dr xxx To Cash a/c Cr xxx (Being ESI & PF payment made to Govt.) 211. what is the service tax ? Service Tax is he tax levied by the government on specified services a the rates specified in the relevant Act. As of now it's levied by the Central Government in India 212. How to prepare salary ? and what is ctc, Epf, etc... salray prepareration is a very importnt work in a factory or company.first preparation of salary is depended on the plolicy of a company . simple calculation no of working days x wages per day if company provide 2 or 3 day off then we will not deduct off days wages. if not then we will not deduct if company provide hra , extra duty,or other benefits then the value will be add in salary 213. Can you provide provision for contigent liablites? Refer the relevant Accounting Standard issued by the Institute of Chartered Accountants of India, which provides guidelines for treating contingent liabilities. 214. What is cost accounting? Cost Accounting is a branch of accounting which is related to; 1. Computation or ascertainment of cost of Products & Services. 2. Cost Control. 3. Cost Reduction. I It involves collection of information & data, verification, analysis, planning of alternative (better) method of operations and so on. In other words it's a branch of accounting which helps & supports the management in achieving and improving the operating efficiency and improve the operational results of a company, which will ultimately result in Profit & wealth maximisation of an organisation. 215. what is accounts receivable and accounts payable and how to use accounts receivable and accounts payable? Accounts payble and accounts recievable are the credit purchases and credit sales which has to collect and pay the amount further. The register was maitained for accounts payable and recievable called accounts payble register and accounts payble reigster which indicate due date and over due by days which will make easy to collect or pay the bills. 217. what is the gernal vocher ? It's not Gernal Voucher, it's 'Journal Voucher'. It the Voucher to record transactions other than, Sales, Purchases, Sales & Purchase Returns, Cash/Bank Payments/Receipts Debit & Credit Notes. It's used to book expenses, incomes other than sales to pass adjustment entries, month/year end closing entries, etc. It's also called 'General Journal Voucher', because all other vouchers are also Journals only, like Purchase Journal, Sales Journal, etc. 218. what is the difference between a call option and a put option? Call option gives the option buyer the right to buy the underlying asset where as put option give the option buyer the right the sell the underlying asset. 219. how to Caluculate professional Tax Professional Tax needs to be paid by Salaried persons, Professionals (Self employed) and also business concerns Companies, Partnership Firms, etc. The amount of tax may change from state to state in India, as it's payable to the Commercial Taxes department of the state under the state Law. For slabs & rates refer to the relevant Act or find out from the Commercial Taxes department It's better to refer the latest edition of any Act relevant. to our requirement or work as it changes from time to time and differ from state to state in case of State Laws. 220. what is the capital goods? Capital goods is a non current asset, which is used to generate the income (like rent,royalty etc)or to get the capital appreciation. Example: Trading property, Development Property, Investment property etc... Even though the nature looks like an inventory the construction/ making process is taking time and all the costs are debited in the CWIP or concerned assets. 221. What is ISIN? ISIN - International securities identification number. a unique international code which identifies securites. 222. what is Working capital Working capital is the gap between current assets and current liablities. and it is calculated by the formula =CA-CL 223. what is Calculation of closing Stock? Closing Stock = Opening Stock + Purchases - sales + Sales Return - Purchase return + WIP. 224. types of the capital market? THERE ARE TWO TYPE OF CAPITAL MARKETS ONE IS PRIMARY MARKET WHICH WORK ON IPO SECOND IS SECONDRY MARKET WHERE PREVOUSLY OWEND SECURITIES ARE EXCHANGED 225. What is Deferred Capital Expenditure / Deferred Revenue Expenditure deferred expenditure means an expense that is paid before the corresponding benefit is fully received, such as a prepaid insurance premium. For accounting purposes, the expense is listed as an asset until the paid-for benefit is obtained, and is usually prorated over a number of subsequent accounting periods, as deferred Capital expenditure is benefit for more than as investment is occurred- eg: Staff sales, Allowance, Perqs, and deferred revenue expenditure is benefit for the requirement full filled, that purpose can't be continue for long life eg: Traveling expenditure for camp/tour program, meals and drinks on office purpose. 226. what is t.d.s TDS (TAX DEDUCTED AT SOURCE) is a kind of indirect tax which has been dedcucted by the payer on certain payments (i.e interest,commission,fee to professionals,payments to contractactors/sub-contractors,rent etc) on specific rates as mentioned under the particular sections. 227. Define Busines entity concept? according to this concept business is treated as seprate person or entity, based on this concept captial is treated as liability to the business, based on this concept we pay intrest on captial 228. goodwill value of two and half time of the average of three yare profit of firm total threeyare (1237500) Rs.1031250 total of three year profit=1237500 Avg of three yr profit=1237500/3=412500 value of goodwill=412500*2.5=1031250. 229. What do you mean by / what is fund management..? Fund management is the professional management of various securities (shares, bonds etc) assets (e.g. real estate), to meet specified investment goals for the benefit of the investors. Investors may be institutions (insurance companies, pension funds, corporations etc.) or private investors (both directly via investment contracts and more commonly via collective investment schemes e.g. mutual funds 230. CONTIGENT LIABILITYES It is a liability which comes into existence on the happening of an uncertain event. 231. What are patents Patents is legal right to an company or individual who is make or invention by them. 232. how to calculate BEP in this problem? Sales Rs.3,00,000 Fixed Exp. Rs. 75,000 Direct Material.Rs.1,00,000 Direct Labour Rs.60,000 Direct exp. RSs.40,000 he Solution is Pariticulars Actuals BEP Sales (100%) 3,00,000/- 2,25,000/- Less: Variable Cost(WN1) 2,00,000/- 1,50,000/- = Contribution 1,00,000/- 75,000/- Less: Fixed Cost 75,000/- 75,000/- = Profit / (Loss) 25,000/- NIL Working Note 1) Variable Cost = Direct Material + Direct Labour + Direct exp Variable Cost = 1,00,000+60,000+40,000 = 2,00,000/- So BEP means when their is no profit no loss. 233 shares & debentures ? share and debentures both are different the company first of all can issue the share and there after issue the debentures main different dividend payable on share and interest payble on debenture and if the company does not arise the profit the dividend not payable but interest on debenture is compulasry if not incurred the profit debenture must be remmed the within the time limit and share can be paid after dissolution of the company 234. what is royalty? A royalty is the landowner's share of the gross production, which is free of the costs of production.Payment made for use of property, especially a patent, copyrighted work,natural resource etc.,Royalities can be received in our own books. 235. what is debit note entry ? We place the order to supplier to supply the goods on the basis of Credit Purchase. due to this supplier send the goods to us by Transport. We received the consignment and found some difficulties that wrongly despatched unwanted goods and broken like that. in this circumstances we returned the damaged/unwanted goods to supplier along with Debit Note. Debit Note amount represents fully or partly depends upon the returned goods value. Example: We purchase the goods on credit basis, asper invoice. value Rs.5200/- including 4% Vat(5000*4%) and then we return the goods to supplier value of Rs.2000/-. We pass the necessery entry in our books. Purchase Entry: Purchase A/c Dr 5000.00 input Vat A/c Dr 200.00 Supplier A/c Cr 5200.00 Debit Note Entry: Supplier A/c Dr.2080.00 Purchase Return. A/c cr. 2000.00 Input Vat A/c cr. 80.00 236. what is debit note received entry ? Sundry Creditors A/C. Dr. To Purchase A/C. Cr. 237. Sales Return is asset or laibility Sales Return is our Asset. because When we received our Goods we will debit Sales Return So it will be Asset. But this will not come to Balance Sheet. It will come to Profit & Loss A/c 238. What you mean by Accruals This is an out standing expnese & could be releted & payable to the current financial year which shuld be accounted in the same year this can help to calculate the accurate profitability 239. scooter fuel is under conveyance and car fuel is under car running & maintenance exp.. Is that right If we put Petrol for Company owned Cars or Scooter we can debit in Petrol Expenses.if we are giving Petrol allowance to Employee we can debit in Conveyance 240. what is the difference betwen p & l a and income & expenditure statement P&L account is prepared by the firms who runs business to make or with a motive to earn Profits. Whereas Income & Exp statement is prepared by the non- profit motive organisations like Orphanages or any other service organisations 241. what is the difference beetwen trade discount and rebate & discount Trade discount is normally given to the regular customers who are buying the products (wholesaler to retailer)in large numbers. It can be like if you buy 100 numbers we will give you 10 numbers free or buy for Rs.1000/- and get 100/- worth free. Rebate is like buy for 1000/- and pay only Rs950/-(Ex: year end clearance sale) Discount is similar to above but will be given for Credit customers.. like if you pay within one week 10%, within 15 days 5% and morethan 15 days no discount. 242. what is the rate of TDS for transpotation 2.06% 243. What is the nature of Outstanding Expenses? Expenses which have been incurred but not yet paid during the accounting period for which the final accounts are being prepared are as called outstanding expenses. Example: Trial balance shows salaries paid Rs.22000. Adjustment : salary for march 2009,Rs.2000 not yet paid. salaries a/c dr 2000 To salaries outstanding a/c 2000 244. explian depriation? asked on 30/7/09 Depriciation is the amount deducted or decreased from the total value of a assest every financial year.Depriciation is of two types 1)writen down value method-dep on dep is called wdv 2)straight line method-dep will be the same for every year 245. what is bankrupt? state of being unable to pay debts. thus, the ownership of the firm'sassets is transferred from the stockholders to the bond holders. 246. Who is the founder of accountancy LUCA PASIOLOquot;
is father of accountancy 247. What is Depreciation and how is it different from amortization depreciation is the poriton of cost of any tangible assest (machinery, etc.) that is used up in business during a year, amortization is portion of cost of intangile assests.e.g. copyrights, etc. hop u understand the difference well. 248. What is life ? LIFE IS A NOVAL WHEN U STUDYING IT IS INTERESTED.WHEN U STOPED IT IS CLOSED 249. define cost of goods sold opening stock+purchases+directexpenses-closing stock=cost of goods sold 250. What is the diffrecnce between liabilities and owner's equity? liabilities means any amount borrowed from outside, it involves all current liability, long term loans, payment dues etc. on the other hand owner's equity means interest of owner in business. like the amount of profit. 251. what is the procedure to get the duplicate Cform in case the original is lost in transit. File an application in Form G to local Tax officer 252. Interest of Rs.30000/- is received from deposits Tds of Rs 7500/- is deducted by the bank please pass the necessary entry for the same Bank a/c Dr 22500.00 TDS on intrest a/c Dr. 7500.00 To Intrest on bank deposit a/c 30000.00 Being Intrest recd from bank on deposit and TDS deduct by the Bank) 253. Professional fees of Rs.30000/- is paid to a consultant ABC & Co. please pass the necessary entry for the same ABC&CO.LTD DR. 26910 TDS ON PROFESSIONAL TAX DR. 3090 TO CASH/BANK A/C 30000 254. information about IBM. international business machine 255. What is suspense Account? suspense account is an account when the trail balance is shown different between debit and cridet balance that time the suspense account will use temperorly for equal debit and credit balance for closing the financial accounts. 256. Mac Purchased on 15th Jan 12000/-30th June Machinery damaged due to Fire Accident31st Dec received the Insurance Premium 13000/-. Pass the Journal Entry for all the above three 15TH JAN DEBIT CREDIT MACHINARY A/C 12000/- TO CASH/CREDITOR A/C 12000/- 30TH JUNE INSURANCE PREMIUM CLAIM A/C 12000/- TO MACHINARY A/C 12000/- 31ST DEC CASH / BANK A/C 13000/- TO INSURANCE PREMIUM CLAIM A/C 12000/- TO OTHER INCOME 1000/- 257. market capitalisation 258. WHY SHOULD WE PREPARE PROFIT & LOSS APPROPRIATION a/c??? In respect of Companies , P & L Appropriation is made to show how the profits of companies have been appropriated (To set apart for a specific use ). For example - Net Profit transffered to General Reserve , proposed dividend etc. These items show how the profit is assigned to different purposes . 259. What is mean by ETDS THE FILING OF TDS THROTGH THE TNTERNET IS ETDS. electron transfer dissociation, ETDS means electronic tax deducted source.We are deducted tax on payments under relevnt Act and under relevent heads. whatver tax we deducted that amount we should be deposit in Income tax Account,evey month 7th is the due date with in7th we need to be deposit in income tax account and every three months onece we need file the returns in income tax Dept. 260. npv, arbitrage NET PRESENT VALUE IS SUM OF PRESENT CASH INFLOWS TO SUM OF PRESENT CASH OUTFLOWS. ARBITRAGE:- HERE BUYING STOCKS FROM ONE MARKET AND SELLING THEM IN ANOTHER MARKET IS CALL ARBITRAGE 261. What is audit,auditing? Auditing is the verification of financial position as is disclosed by the balance sheet and the p/l a/c 262. Please let me know the journal entry for the below. quot;
Aquot;
paid Rs.100 to quot;
Cquot;
on behalf of quot;
Bquot;
 In the Books of A B A/c Dr. 100 To, Cash 100 (C is just a third party, Receiving the money on hehalf of B. As in the books of A there is no out standing against C but it is against B) In the Books of C Cash A/c Dr. 100 To, B A/c (In ths books of C it must be receivable from B, so B must have said to A, that the money which you owe to me please pay directly to C In the books of B C A/c Dr. 100 To A A/c 100 (paid by A to C) 263. what is revaluation of assets and liabilities? changing the price of the book price of asset or liabilities to the market price is revaluation 264. I am trying to understand the connection between cost structure and contribution margin to make a profit? Contribution is nothing but the selling price less the variable cost relation to that prodcut. Profit earned by any orgination is the figure which contribution marging gives after adjusting the fixed cost . 265. Explain about Accounts Payable. Accounts payable is nothing but quot;
money which a company need to pay to vendors for goods and services purchased on credit. 1.Accounts payable is a current liability of a company.2. This item appears on liability side of a balance sheet 266. What is debit and credit from the banks point of view ? In Banks point of view debit means u have deposited money in the bank . and credit means u have withdraw money from the banks. in other word we can say that if debit bank balances shows in bank statement this means it is the unfavorable condition for the company and credit balance means it is the favorable condition for the company. 267. What is debit and credit from the customer point of view ? From the customer point of view:DEBIT is the expenditure which he incurrs( purchase of a car, car account).CREDIT is the payment ,cash or bank account ( if payment paid thru cheque) 268. What is three way matching of invoice? What is the difference PO able invoice and non PO able invoice? PO expenses are paid for the core business acitvities.e.g a food manufacturing co. will pay its usual chargesfor Raw material freight,plant maintenance etc.A non PO expenditure is the one which is payment for its non core activities e.g payment of utility bills e.g telephone charges, electricity bill.for usual trnsactions of core business transaction a PO is created ie.Purchase order# is created & non PO is for non core activities.

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