21⟩ What is Asset Accounting?
dep is the decreasing the value of assets
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29 Accounting Reports Questions And Answers
22⟩ How to book a letter of credit in your books?
The Money Behind a Letter of Credit.
A bank promises to pay on behalf of a customer, but where does the money come from? The bank will only issue a letter of credit if they know the buyer will pay. Some buyers have to deposit (or already have) enough money to cover the letter of credit, and some customers use a line of credit with the bank. Sellers must trust that the bank issuing the letter of credit is legitimate.
23⟩ What is Budgeting?
It is forecasting of expenses/income of company which can made by our past records or by some assumption.
24⟩ Tell me how many methods are used to calculate depreciation?
3 popular types
1st straightline
2nd declining balance
3rd Sum-of-Years' Digits Method
25⟩ Explain who is responsible for maintaining the Accounts receivable in an organization?
This is based on Company, In MNC's different works are done by different people but in small companies all accounting is done by accountant which includes Receivables, Payables, Banks,cash etc.,
26⟩ What is MIS reports?
A management information system (MIS) is a subset of the overall internal controls of a business covering the application of people, documents, technologies, and procedures by management accountants to solve business problems such as costing a product, service or a business-wide strategy.
27⟩ Do you know Variance Analysis with Example?
Variance analysis in budgeting or management accounting in general is a tool of budgetary control by evluation of performance by means of variance between budgeted amount, planned amount or standard amt and the actual amt incurred/sold.
Variance can be carried out for both revenue & cost. Variance analysis hepls the management to know the present cost & then control the future cost.
Examples includes sale price variance, sales quantity variance, sales mix variance.
28⟩ Explain how to place journal entry for purchase order in books of account?
Generally there is no journal entry at the time when one receives a purchase order as this receipt of purchase order cannot be recognized as revenue at this point of time.
But under following circumstance there would be an entry:
when any advance is received:-
Cash/ Bank Dr
Party account
29⟩ Tell me how to prepare funds flow statement?
A fund flow statement or a cash flow statement records the changes in monetary funds over a period of time, usually by comparing the latest position at balance sheet date with the corresponding monetary position a year ago.
There are various elements of business that affect fund/cash flow. These include such things as increased sales, reductions or increases in debtors, longer or shorter times in paying creditors, repayments of loans, etc., a summary of which should be shown on separate lines of the statement. It can start with a section listing the elements that contribute to an increase in cash, then the next section lists those items which have contributed to a decrease in cash.
Space (and time!) does not permit more comprehensive details of what is needed and how to do it. You should consult a text book on Financial Accounting and look at the fund/cash flow statement of a company similar to the one for which you wish to prepare such a statement.
At the end of the fund/cash flow statement, if you have done all your calculations correctly, and taken everything that affects cash movement into account, your final figure will equal the cash figure in the balance sheet.
