Here are 40 common accounting interview questions and answers for freshers:
General Accounting Questions
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What is accounting? Accounting is the process of recording, summarizing, analyzing, and reporting financial transactions of a business to help stakeholders make informed decisions.
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What are the golden rules of accounting?
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Personal Account: Debit the receiver, credit the giver.
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Real Account: Debit what comes in, credit what goes out.
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Nominal Account: Debit all expenses and losses, credit all incomes and gains.
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What is the difference between accounts payable and accounts receivable?
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Accounts Payable: Money a company owes to suppliers or creditors.
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Accounts Receivable: Money owed to the company by customers for goods or services.
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What are the types of accounting?
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Financial Accounting
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Management Accounting
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Cost Accounting
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Tax Accounting
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Forensic Accounting
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What are assets and liabilities?
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Assets: Resources owned by a company (e.g., cash, inventory, equipment).
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Liabilities: Obligations or debts owed to others (e.g., loans, accounts payable).
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Common accounting interview questions and answers for freshers:
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What is a trial balance? A trial balance is a statement that lists all the ledger account balances to check if total debits equal total credits.
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What is depreciation? Depreciation is the systematic allocation of the cost of a tangible asset over its useful life.
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What is the difference between cash and accrual accounting?
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Cash Accounting: Revenue and expenses are recorded when cash is received or paid.
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Accrual Accounting: Revenue and expenses are recorded when they are earned or incurred, regardless of cash flow.
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What is a journal entry? A journal entry records financial transactions in the accounting system, showing debits and credits.
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What is the accounting equation? Assets = Liabilities + Owner’s Equity.
Practical Knowledge Questions
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What is the purpose of a balance sheet? A balance sheet provides a snapshot of a company’s financial position, showing assets, liabilities, and equity at a specific point in time.
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What is the difference between a ledger and a journal?
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Journal: Records transactions chronologically.
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Ledger: Summarizes journal entries into individual account balances.
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What is goodwill? Goodwill is an intangible asset that represents the value of a company’s brand, reputation, or customer base.
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What are prepaid expenses? Prepaid expenses are payments made in advance for goods or services to be received in the future.
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What are contingent liabilities? Contingent liabilities are potential obligations dependent on future events (e.g., lawsuits, guarantees).
Software and Tools
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Have you worked with accounting software? As a fresher, I have theoretical knowledge of tools like Tally, QuickBooks, and Excel, and I am eager to learn any specific software used in your company.
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What is ERP in accounting? ERP (Enterprise Resource Planning) integrates various business processes, including accounting, into a unified system.
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What functions of Excel are useful for accounting?
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VLOOKUP, HLOOKUP
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Pivot Tables
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SUMIF, COUNTIF
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Macros
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Conditional Formatting
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What is Tally? Tally is an accounting software widely used for financial management, GST compliance, payroll, and inventory management.
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What is bank reconciliation? Bank reconciliation compares the company’s financial records with the bank statement to ensure consistency.
Behavioral Questions
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Why did you choose accounting as a career? I enjoy working with numbers and problem-solving, and accounting offers opportunities to contribute to a company’s financial success.
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How do you handle tight deadlines? By prioritizing tasks, using time management techniques, and staying focused on the most critical work.
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How do you ensure accuracy in your work? By double-checking calculations, using accounting software, and maintaining organized records.
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Describe a situation where you worked in a team. During my college project, I collaborated with my peers to create a mock financial report, which taught me teamwork and attention to detail.
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How do you handle feedback? I view feedback as an opportunity to grow and improve my skills.
Situational and Problem-Solving Questions
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How would you rectify an accounting error?
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Identify the error.
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Pass a rectification entry.
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Ensure the corrected entry balances the accounts.
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What would you do if your balance sheet doesn’t balance?
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Recheck journal entries and ledger balances.
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Verify trial balance figures.
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Look for errors like omitted transactions or misposted amounts.
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How do you manage confidential financial data? By adhering to company policies, using secure systems, and maintaining professionalism.
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How would you handle a discrepancy in a financial report?
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Investigate the source of the discrepancy.
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Cross-check entries and supporting documents.
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Resolve the issue and report findings to the supervisor.
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What steps would you take to improve a company’s cash flow?
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Monitor accounts receivable and payable.
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Optimize inventory management.
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Reduce unnecessary expenses.
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Advanced Topics for Discussion
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What is working capital? Working capital = Current Assets – Current Liabilities. It measures a company’s short-term liquidity.
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What is deferred revenue? Deferred revenue is money received for goods or services not yet delivered.
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What is the matching principle? The matching principle states that expenses should be recognized in the same period as the revenue they help generate.
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What is inventory valuation? Methods include FIFO, LIFO, and Weighted Average Cost to determine the value of inventory.
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What is the difference between capital and revenue expenditure?
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Capital Expenditure: Long-term investments (e.g., machinery).
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Revenue Expenditure: Day-to-day operational expenses (e.g., salaries).
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Miscellaneous Questions
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What is a profit and loss statement? It shows a company’s revenue, expenses, and profit or loss over a specific period.
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What is accrual basis accounting? Accrual basis accounting records revenues and expenses when they are earned or incurred, not when cash is exchanged.
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What is the dual aspect concept? Every transaction affects at least two accounts, ensuring the accounting equation stays balanced.
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What are provisions? Provisions are funds set aside to cover future liabilities or losses.
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What is the role of an auditor? An auditor examines financial statements to ensure accuracy, compliance, and fair representation of a company’s financial position.
These questions and answers will help you prepare for entry-level accounting interviews. Tailor your responses to reflect your education and any practical knowledge or internships you’ve undertaken.
IPA offers:-
Accounting Course , Diploma in Taxation, Courses after 12th Commerce , courses after b com
Diploma in Financial Accounting , SAP fico Course , Accounting and Taxation Course , GST Course , Basic Computer Course , Payroll Course, Tally Course , Advanced Excel Course , One year course , Computer adca course
IPA offers:-
Accounting Course , Diploma in Taxation, Courses after 12th Commerce , courses after b com
Diploma in Financial Accounting , SAP fico Course , , GST Course , Basic Computer Course , Payroll Course, Tally Course , Advanced Excel Course , One year course , Computer adca course
