Top 25 Accounting Interview Questions and Answers

Accounting interviews can be challenging for many candidates. You’re expected to know more than basics. Interviewers test accuracy, logic, and clarity together. They also look for confidence and communication skills. Even small errors can raise red flags. That’s why strong preparation is very important. Knowing what to expect makes a big difference. This blog helps you prepare the right way. We’ve listed top accounting interview questions and answers. You’ll find a mix of formats and topics. From technical entries to HR-based scenarios, it’s all here. These examples will sharpen your interview readiness fast. Let’s get started with the most important questions.

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Top 25 Accounting Interview Questions and Answers: Introduction

Accounting jobs require more than just textbook knowledge. Employers look for accuracy, speed, and clarity. They want candidates who understand concepts and tools. You may face theory, practical, or behavioral questions. Each question checks your confidence and problem-solving ability. So, proper preparation is your best strategy.

Here’s what this blog will help you with:

Understand the Interview Structure

• Learn what types of questions to expect

• Identify key accounting areas usually covered

Prepare for All Question Categories

• Basic and conceptual understanding

• Journal entries and formula-based calculations

• Real-life scenarios and decision-making questions

• Behavioral and HR-focused queries

Learn How to Answer Smartly

• Use simple, clear, and structured answers

• Support your responses with relevant examples

Get Bonus Tips to Stand Out

• Improve communication and soft skills

• Prepare for tool-based or ERP-related questions

Top Accounting Interview Questions and Answers

1. What are the golden rules of accounting? (Basic)

Answer:

• There are three golden rules for different account types:

  • Personal Account → Debit the receiver, credit the giver.

  • Real Account → Debit what comes in, credit what goes out.

  • Nominal Account → Debit all expenses and losses, credit all incomes and gains.

2. What is the accounting equation? (Basic)

Answer:

• The basic accounting equation is:

  • Assets = Liabilities + Equity

• It shows that a company’s assets are funded by liabilities or owner’s equity.

• This forms the foundation of the double-entry system.

• Every financial transaction affects this equation in some way.

3. What is the difference between bookkeeping and accounting? (Basic)

Answer:

• Bookkeeping involves recording daily financial transactions.

• Accounting includes interpreting, analyzing, summarizing, and reporting.

• Bookkeeping is a part of the accounting process.

• Bookkeeping does not include financial decision-making.

• Accounting helps in evaluating business performance.

4. What is the difference between cost accounting and financial accounting? (Basic)

Answer:

• Cost accounting focuses on tracking internal costs.

• Financial accounting deals with external financial reporting.

• Cost accounting helps management make internal decisions.

• Financial accounting follows GAAP or IFRS standards.

• Reports in financial accounting are for stakeholders.

5. What is working capital? (Basic)

Answer:

• Working Capital = Current Assets – Current Liabilities

• It indicates a company’s short-term liquidity.

• Positive working capital shows financial health.

• It is used for daily operational needs.

• Poor working capital can lead to cash flow issues.

6. How do you calculate depreciation using the straight-line method? (Formula-Based)

Answer:

• Formula:

  • Depreciation = (Cost – Salvage Value) / Useful Life

• Used for spreading asset cost evenly over years.

• Helps maintain consistency in financial statements.

• Example: Asset cost = ₹1,00,000, Salvage = ₹10,000, Life = 5 years

• Depreciation = (100000 – 10000)/5 = ₹18,000 per year.

7. What is the formula for gross profit? (Formula-Based)

Answer:

• Gross Profit = Revenue – Cost of Goods Sold (COGS)

• Shows profit from core operations only.

• Does not include indirect expenses like rent or salary.

• Important for evaluating product profitability.

• Higher gross profit means better pricing or lower cost.

8. How is net profit calculated? (Formula-Based)

Answer:

• Net Profit = Gross Profit – Operating Expenses – Taxes

• Also known as the bottom line.

• Indicates the company’s actual earnings.

• Helps assess overall business performance.

• Used in financial analysis and tax filings.

9. What is the formula for current ratio? (Formula-Based)

Answer:

• Current Ratio = Current Assets / Current Liabilities

• Measures short-term financial strength.

• Ratio > 1 shows good liquidity.

• Ratio < 1 indicates risk of default.

• Ideal range: 1.5 to 2 for most businesses.

10. How is Return on Investment (ROI) calculated? (Formula-Based)

Answer:

• ROI = (Net Profit / Investment Cost) × 100

• Measures profitability of an investment.

• Useful for comparing investment options.

• ROI above 15% is considered healthy.

• Helps in budgeting and financial planning.

11. What would you do if a ledger doesn’t balance? (Scenario-Based)

Answer:

• First, recheck all debit and credit entries.

• Look for incorrect account codes or mispostings.

• Verify closing balances of all ledger accounts.

• Compare trial balance with supporting documents.

• Make correcting entries if needed, then recheck totals.

12. A customer overpaid an invoice. What steps do you take? (Scenario-Based)

Answer:

• Confirm the extra amount received from records.

• Contact the customer for clarification or refund.

• Adjust the extra amount in the next invoice, if agreed.

• Pass a journal entry for temporary holding.

• Maintain clear communication and documentation.

13. How would you handle a delayed vendor payment? (Scenario-Based)

Answer:

• Check the reason behind the delay.

• Communicate with the vendor and explain the situation.

• Propose a new payment date if needed.

• Ensure internal approval is received for release.

• Record updated due dates and follow-up status.

14. How do you manage last-minute changes in closing entries? (Scenario-Based)

Answer:

• Quickly verify the requested changes.

• Discuss with the senior accountant or manager.

• Pass adjustment entries if required.

• Update the trial balance and reports accordingly.

• Document the reason and approval for audit purposes.

15. You find a duplicate payment entry. What will you do? (Scenario-Based)

Answer:

• Identify the duplicate entry through ledger comparison.

• Reverse the incorrect entry immediately.

• Inform the finance team to avoid overpayment.

• Keep audit notes for future reference.

• Adjust balances and update financial statements.

16. Tell me about a time you handled an accounting error. (Behavioral)

Answer:

• Found a mismatch in the trial balance.

• Traced it to a wrongly posted expense.

• Corrected the journal entry and updated records.

• Documented the issue for future reference.

• Shared learning with the team to avoid recurrence.

17. How do you prioritize tasks during month-end? (Behavioral)

Answer:

• Start with reconciliation of bank statements.

• Finalize invoices and vendor payments next.

• Coordinate with teams for pending entries.

• Prepare and review draft reports early.

• Keep a checklist to stay on track.

18. Describe a time you worked under pressure. (Behavioral)

Answer:

• Worked on three urgent financial reports together.

• Prioritized tasks and divided workload efficiently.

• Stayed calm and focused on quality.

• Completed all tasks before deadline.

• Received appreciation for performance under pressure.

19. How do you handle disagreement in a team setting? (Behavioral)

Answer:

• Listen to all opinions with an open mind.

• Share facts and support with data.

• Find a middle ground that suits everyone.

• Focus on team goal, not personal views.

• Maintain respectful and clear communication.

20. What motivates you in an accounting role? (Behavioral)

Answer:

• I enjoy working with numbers and logic.

• Accuracy and structure give me satisfaction.

• I like solving financial puzzles and issues.

• Working with teams builds my communication skills.

• Learning new tools keeps me motivated.

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21. Pass a journal entry for rent paid in advance. (Technical)

Answer:

• Prepaid Rent A/c Dr.

• To Cash/Bank A/c

• Reason: Asset is increasing, cash is reducing.

• Adjusted in the next period when rent is due.

• Reflects accurate matching of expense to period.

22. What is a trial balance? (Technical)

Answer:

• A list of all ledger accounts and balances.

• Prepared to check if debits equal credits.

• Helps identify errors before financial reporting.

• Basis for preparing the final accounts.

• Usually created monthly or quarterly.

23. What are the types of vouchers in accounting? (Technical)

Answer:

• Receipt Voucher – for incoming payments

• Payment Voucher – for outgoing payments

• Journal Voucher – for adjustments

• Contra Voucher – for transfers between cash/bank

• Each voucher has supporting documents attached.

24. What is the difference between capital and revenue expenditure? (Technical)

Answer:

• Capital Expenditure: Long-term, adds value to assets.

• Revenue Expenditure: Short-term, for daily operations.

• Capital is recorded as an asset.

• Revenue is treated as an expense.

• Both affect profit and loss differently.

25. What is depreciation and why is it important? (Technical)

Answer:

• Depreciation is loss of asset value over time.

• Reflects wear and tear or obsolescence.

• Helps match expenses with revenue.

• Required for accurate profit calculation.

• Common methods: Straight-line and written-down value.

Bonus: Tips for Cracking Accounting Interviews

Stay calm and confident throughout the interview process. Understand the job role and company expectations clearly. Keep your accounting basics and formulas well revised. Use real examples when answering scenario-based questions. Practice with mock interviews to improve performance quickly.

Before the Interview

• Research the Company:

  • Know their services, clients, and financial position.

• Review Your Resume:

  • Be ready to explain every point mentioned.

• Revise Key Concepts:

  • Go through journal entries, ratios, and principles.

During the Interview

• Listen Carefully:

  • Don’t rush to answer — think first.

• Be Honest:

  • Admit if you don’t know something.

• Explain with Logic:

  • Show your thought process and accuracy.

After the Interview

• Send a Thank You Email:

  • Appreciate the opportunity and express interest.

• Reflect on Performance:

  • Note questions you found difficult.

• Continue Practicing:

  • Keep learning even after the interview ends.

Top Accounting Interview Questions and Answers: Conclusion

Accounting interviews need smart answers and sharp thinking. You must understand both theory and real situations. Practice common questions and focus on key concepts. Stay confident even when you face tricky questions. Use structured answers with short and clear steps. Show your interest in learning and growing professionally. With the right preparation, you will succeed easily.

Key Takeaways:

• Revise golden rules, journal entries, and formulas.

• Practice behavioral and scenario-based answers.

• Learn tool-based tasks like Tally or Excel.

• Stay honest and composed during the interview.

• Follow up with a thank-you email.