Executive Accounts Interview Preparation Guide
Elevate your Executive Account interview readiness with our detailed compilation of 83 questions. Each question is designed to test and expand your Executive Account expertise. Suitable for all experience levels, these questions will help you prepare thoroughly. Secure the free PDF to access all 83 questions and guarantee your preparation for your Executive Account interview. This guide is crucial for enhancing your readiness and self-assurance.83 Executive Account Questions and Answers:
1 :: What is capitalization? What is its importance?
Capitalization is a term which has different meanings in both financial and accounting context. Capitalization in accounting means the cost to buy an asset which is included in the price of the asset whereas in financial terms it is the cost which is required to buy an asset which includes price of a particular asset and it also include the retained earnings of a company with stock debt and long term debt. There are two kinds of capitalization which are called as Over-capitalization and another is called as Under-capitalization. Capitalization is very import aspect in determining the value of the company in the market which is based on the economic structure of the company. This aspect depends on the previous records and economics of the company. This also shows a particular behaviour of the companies' structure and allows them to create a plan to do the marketing.
2 :: Tell me what is Mercantile or Accrual System of Accounting?
In this system, expenses and incomes are considered during that period to which they pertain. This system of accounting is considered to be ideal but it may result into unrealized profits which might reflect in the books of the accounts on which the organization have to pay taxes too. All the company forms of organization are legally required to follow Mercantile or Accrual System of Accounting.
3 :: Can you please Compare Financial Accounting and Cost Accounting?
1) Financial Accounting protects the interests of the outsiders dealing with the organization e.g shareholders, creditors etc. Whereas reports of Cost Accounting is used for the internal purpose by the management to enable the same in discharging various functions in a proper manner.
2) Maintenance of Financial Accounting records and preparation of financial statements is a legal requirement whereas Cost Accounting is not a legal requirement.
3) Financial Accounting is concerned about the calculation of profits and state of affairs of the organization as whole whereas Cost accounting deals in cost ascertainment and calculation of profitability of the individual products, departments etc.
4) Financial Accounting considers only transactions of historical financial nature whereas Cost Accounting considers not only historical data but also future events.
5) Financial Accounting reports are prepared in the standard formats in accordance with GAAP whereas Cost accounting information is reported in whatever form management wants
2) Maintenance of Financial Accounting records and preparation of financial statements is a legal requirement whereas Cost Accounting is not a legal requirement.
3) Financial Accounting is concerned about the calculation of profits and state of affairs of the organization as whole whereas Cost accounting deals in cost ascertainment and calculation of profitability of the individual products, departments etc.
4) Financial Accounting considers only transactions of historical financial nature whereas Cost Accounting considers not only historical data but also future events.
5) Financial Accounting reports are prepared in the standard formats in accordance with GAAP whereas Cost accounting information is reported in whatever form management wants
4 :: What are important things to be remembered while preparing a bank reconciliation statement?
While preparing a bank reconciliation statement following important points need to be remembered:
► Bank Reconciliation Statement is prepared either by starting with the Bank pass book balance or Cash book balance.
► If the balance of the Cash book is taken as a starting point then Cash book balance is to be adjusted in accordance with the entries passed in the Bank pass book and vice versa. For example: If the balance is taken as per the Cash book then the following items will be added:
► Cheques issued but not presented for payment;
► Amount credited in Passbook but not in Cash book;
► Deposits made in the bank directly;
► Wrong credits given by bank;
► Interest credited in the Passbook.
The following items will be subtracted:
► Cheques deposited but not cleared;
► Interest/Bank Charges debited by bank
► Direct payments made by bank not entered in Cash book
► Cheques dishonoured not recorded in cash book
► Wrong debits given by bank
► If it is prepared with the Bank balance as per the bank passbook, then the above procedure will be reversed i.e the items will be added to the pass book which were deducted from the cash book balance and those items will be deducted from the bank pass book balance which were added to the cash book balance.
► Bank Reconciliation Statement is prepared either by starting with the Bank pass book balance or Cash book balance.
► If the balance of the Cash book is taken as a starting point then Cash book balance is to be adjusted in accordance with the entries passed in the Bank pass book and vice versa. For example: If the balance is taken as per the Cash book then the following items will be added:
► Cheques issued but not presented for payment;
► Amount credited in Passbook but not in Cash book;
► Deposits made in the bank directly;
► Wrong credits given by bank;
► Interest credited in the Passbook.
The following items will be subtracted:
► Cheques deposited but not cleared;
► Interest/Bank Charges debited by bank
► Direct payments made by bank not entered in Cash book
► Cheques dishonoured not recorded in cash book
► Wrong debits given by bank
► If it is prepared with the Bank balance as per the bank passbook, then the above procedure will be reversed i.e the items will be added to the pass book which were deducted from the cash book balance and those items will be deducted from the bank pass book balance which were added to the cash book balance.
5 :: What made you choose to become an accountant?
I've always loved numbers. Loved math in school, and I just want a job that allows me to stick to the figures all day.
The interviewer wants to see that you have some sort of passion driving you.
The interviewer wants to see that you have some sort of passion driving you.
6 :: What is Financial Accounting. What are its characteristic features?
Financial Accounting is the process in which business transactions are recorded systematically in the various books of accounts maintained by the organization in order to prepare financial statements. These financial statements are basically of two types: First is Profitability Statement or Profit and Loss Account and second is Balance Sheet.
Following are the characteristics features of Financial Accounting:
1) Monetary Transactions: In financial accounting only transactions in monetary terms are considered. Transactions not expressed in monetary terms do not find any place in financial accounting, howsoever important they may be from business point of view.
2) Historical Nature: Financial accounting considers only those transactions which are of historical nature i.e the transaction which have already taken place. No futuristic transactions find any place in financial accounting, howsoever important they may be from business point of view.
3) Legal Requirement: Financial accounting is a legal requirement. It is necessary to maintain the financial accounting and prepare financial statements there from. It is also obligatory to get these financial statements audited.
4) External Use: Financial accounting is for those people who are not part of decision making process regarding the organization like investors, customers, suppliers, financial institutions etc. Thus, it is for external use.
5) Disclosure of Financial Status: It discloses the financial status and financial performance of the business as a whole.
6) Interim Reports: Financial statements which are based on financial accounting are interim reports and cannot be the final ones.
7) Financial Accounting Process: The process of financial accounting gets affected due to the different accounting policies followed by the accountants. These accounting policies differ mainly in two areas: Valuation of inventory and Calculation of depreciation.
Following are the characteristics features of Financial Accounting:
1) Monetary Transactions: In financial accounting only transactions in monetary terms are considered. Transactions not expressed in monetary terms do not find any place in financial accounting, howsoever important they may be from business point of view.
2) Historical Nature: Financial accounting considers only those transactions which are of historical nature i.e the transaction which have already taken place. No futuristic transactions find any place in financial accounting, howsoever important they may be from business point of view.
3) Legal Requirement: Financial accounting is a legal requirement. It is necessary to maintain the financial accounting and prepare financial statements there from. It is also obligatory to get these financial statements audited.
4) External Use: Financial accounting is for those people who are not part of decision making process regarding the organization like investors, customers, suppliers, financial institutions etc. Thus, it is for external use.
5) Disclosure of Financial Status: It discloses the financial status and financial performance of the business as a whole.
6) Interim Reports: Financial statements which are based on financial accounting are interim reports and cannot be the final ones.
7) Financial Accounting Process: The process of financial accounting gets affected due to the different accounting policies followed by the accountants. These accounting policies differ mainly in two areas: Valuation of inventory and Calculation of depreciation.
7 :: Explain where do you see yourself in five years?
Hopefully still in accounting. This is my dream career path, so just being here would be great.
The interviewer wants to know that you don't have plans to bail on the job a year or two from now. It's alright to want kids, but now's not the time to mention that.
The interviewer wants to know that you don't have plans to bail on the job a year or two from now. It's alright to want kids, but now's not the time to mention that.
8 :: What are the various systems of Accounting?
There are two systems of Accounting:
1) Cash System of Accounting: This system records only cash receipts and payments. This system assumes that there are no credit transactions. In this system of accounting, expenses are considered only when they are paid and incomes are considered when they are actually received. This system is used by the organizations which are established for non profit purpose. But this system is considered to be defective in nature as it does not show the actual profits earned and the current state of affairs of the organization.
2) Mercantile or Accrual System of Accounting: In this system, expenses and incomes are considered during that period to which they pertain. This system of accounting is considered to be ideal but it may result into unrealized profits which might reflect in the books of the accounts on which the organization have to pay taxes too. All the company forms of organization are legally required to follow Mercantile or Accrual System of Accounting.
1) Cash System of Accounting: This system records only cash receipts and payments. This system assumes that there are no credit transactions. In this system of accounting, expenses are considered only when they are paid and incomes are considered when they are actually received. This system is used by the organizations which are established for non profit purpose. But this system is considered to be defective in nature as it does not show the actual profits earned and the current state of affairs of the organization.
2) Mercantile or Accrual System of Accounting: In this system, expenses and incomes are considered during that period to which they pertain. This system of accounting is considered to be ideal but it may result into unrealized profits which might reflect in the books of the accounts on which the organization have to pay taxes too. All the company forms of organization are legally required to follow Mercantile or Accrual System of Accounting.
9 :: Name the accounting applications that you're comfortable with?
I'm comfortable with Quickbooks and Netsuite. However, I'm computer savvy and believe I could learn another system relatively quickly.
Even if you don't know the program they work with, the interviewer is okay so long as you mention that you're willing to learn their system.
Even if you don't know the program they work with, the interviewer is okay so long as you mention that you're willing to learn their system.
10 :: Tell me What is Cash System of Accounting?
This system records only cash receipts and payments. This system assumes that there are no credit transactions. In this system of accounting, expenses are considered only when they are paid and incomes are considered when they are actually received. This system is used by the organizations which are established for non profit purpose. But this system is considered to be defective in nature as it does not show the actual profits earned and the current state of affairs of the organization.