Questions in: Accounting & Finance

Right Answer:
Payroll is the process of calculating and distributing employee wages, salaries, bonuses, and deductions, as well as maintaining records of these payments.

Right Answer:
A journal voucher is a document used to record a financial transaction in the accounting system, while a contra entry is a specific type of journal entry that involves both a debit and a credit to accounts within the same category, typically to offset each other, such as cash and bank accounts.

Right Answer:
VAT Payable is Rs 166.67.

Right Answer:
A budget is a financial plan that outlines expected income and expenses for a specific period, while budgeting is the process of creating and managing that budget.

Right Answer:
The portion of the building used for residential purposes should be reclassified as an expense or a separate asset, depending on the accounting policy. The value related to the residential use (half of the building) should not be included in the business assets on the balance sheet.

Right Answer:
You can explain your reasons for quitting your previous job by focusing on positive aspects, such as seeking new challenges, wanting to grow professionally, pursuing a better work-life balance, or looking for opportunities that align more closely with your career goals. Avoid negative comments about your previous employer or colleagues.

Right Answer:
The companies coded in SENSEX include Tata Consultancy Services (TCS), Reliance Industries, HDFC Bank, Infosys, and many others.

Right Answer:
A spin-off is a corporate action where a company creates a new independent company by selling or distributing new shares. The new company is formed from a portion of the parent company's assets or operations.

Right Answer:
For VAT refundable, the journal entry is:

**Debit**: VAT Receivable (or VAT Refundable)
**Credit**: Sales Tax Payable (or VAT Payable)

For VAT payable, the journal entry is:

**Debit**: Sales Tax Payable (or VAT Payable)
**Credit**: Cash/Bank (or Accounts Payable)

Right Answer:
The entry for a tour advance given to a party would be:

**Debit:** Tour Advance (Asset Account)
**Credit:** Cash/Bank (Asset Account)

The expenditure head would typically be categorized under "Travel Expenses" or "Tour Expenses" when the actual expense is incurred.

Right Answer:
Accounts Payable refers to the money a company owes to its suppliers for goods and services received but not yet paid for. Accounts Receivable refers to the money owed to a company by its customers for goods and services provided but not yet paid for.

Right Answer:
Venture capital is a type of private equity financing that investors provide to startups and small businesses with high growth potential in exchange for equity, or ownership stake, in the company.

Right Answer:
The three basic accounting principles are:

1. **Revenue Recognition Principle** - Revenue is recognized when earned, regardless of when cash is received.
2. **Matching Principle** - Expenses should be matched with the revenues they help to generate in the same period.
3. **Cost Principle** - Assets should be recorded at their original cost, not their current market value.

**Account reconciliation** is the process of comparing two sets of records to ensure they are in agreement and to identify any discrepancies.

**Portfolio management** is the art and science of making decisions about investment mix and policy, aligning investments to objectives, and balancing risk against performance.

Right Answer:
Accounts Payable and Accounts Receivable are Personal Accounts.