Accounting Questions and Answers

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Q - 1 Who owns the general ledger?

Ans- Every company has to maintain General Ledger.
So company owns the GL

Q - 2 Where should TDS received should show in balance sheet?

Ans- Assets Side: Advance In-Come Tax Ledger in current year

Q - 3 What is the TDS effect in balance sheet if TDS receipts?

Ans- In Assets Side: Advance In-Come-Tax A/c Dr with TDS received Amount and Party A/c Cr with TDS received Amount

Q - 4 What are the golden rules of accounting?

Ans- Personal-

Debit the receiver

Credit the Giver

Real-

Debit what comes in

Credit what goes out

Nominal-

Debit all expenses and losses

Credit all income and gains

Q - 5 Can I take service tax on freight outward?

Ans- Yes, you can take tax on freight outward. Because you are paid freight inclusive of service, tax so you can full credit availed on any expenditure where you paying service tax amount.

Q - 6 What is service tax?

Ans- When any employer provides any service to his customer, which income is excess under the tax then company liable for the pay tax.

Service tax charged at rate 12 %( India) + 3% E.Cess & H. & E.Cess

=12.36%

In addition, service tax deposited of in under 5 days who you charged service tax to his customers.

In the payment of Service tax amount you can Credit availed during of the month.

Moreover, if any company purchased of any item that has Excise duty & E.Cess with E.Cess then you can credit availed when you received excise form to your seller.

Q - 7 What is Contingent Liabilities?

Ans- A continental liability may or may not be liability to the company. It is mandatory to show in Balance Sheet. Ex:- Ex gratia payable to Workers. Sometimes company has to pay, sometimes may not pay.

Q - 8 What is an adjusting journal entry?

Ans- Adjusting entries are those entries that passed to rectify an error or wrong entry already made some accounting soft wares have disabled edit function in the accounts, so the only way to undo the mistake is to pass a correction entry or adjusting entry.

Q - 9 What is the difference between provision and reverse?

Ans- Provisions are created in books as they are anticipated. Example: provision for depreciation

Reserves are created in books as a part of profits, which might used to purchase assets or to declare dividends.

Q - 10 What is the difference between Perpetual and Periodic Inventory systems?

Ans- In perpetual inventory system, the inventory account is adjusted continually throughout the accounting period.

Whereas in the Periodic Inventory System: - Recording inventory transactions periodically than recording them continually.

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