Top 19 Accounting Interview Questions and Sample Answers [2020]

accounting interview questions

Interviewing for an accounting position requires a firm understanding of the accounting function within an organization. Whether interviewing with a public accounting firm or with a business directly, the hiring manager is going to test core competencies through behavioral interview questions and domain knowledge of the accounting function and the accounting process through questions that qualify the candidate.

An accounting interview process is similar to any other job interview. A hiring manager or accountant will perform the interview. The interviewer will sit with the candidate for anywhere from 30 minutes to one hour. And ask a number of questions that address the requirements of the accounting role.

Some roles that these interview questions are applicable for are:

Questions like these can be seen when being hired as an accounting professional in a public accounting firm, small accounting firm, or by the business directly as part of the accounting department.

These questions are less applicable for those applying to investment banking positions. When the interviewer asks a behavioral interview question, which starts with, “Tell me about a time..” it should be answered with a previous work situation and story. Use the STAR method to answer these questions. STAR stands for “Situation, Task, Action, Result” and can be a helpful method for telling a unique and insightful story in a short period of time. A behavioral question will always be an open-ended question that prompts the candidate to tell a story.

All interview questions should be answered in roughly 90-seconds or less. As a job candidate, it’s important to have a friend or family member ask each interview question and practice the delivery and response to the prospective employer.

Accounting Interview Questions and Sample Answers

Below is a list of common accounting interview questions and sample answers.

1. What does it mean to be an accountant?

Sample answer: An accountant is an essential function of a business. Without the accounting function and accounting application applied to a business, the organization and the operators of the business can suffer losses or financial burdens at the end of each quarter or fiscal year. The accounting concept is the act of recording financial activity in order to report and review the status and health of a business.

2. Why is accounting important to a business?

Sample answer: Accounting is important to the business because it alleviates a heavy burden on the operators to track accounting principles and accounting functions in the business. If the operators were to track the accounting needs of the business, the regular service providing or product development of the business would be slowed.

3. What is a balance sheet?

Sample answer: A balance sheet is a statement of financial position or statement of financial condition. It is a summary of the financial balance of the organization and the business.

4. What is the financial statement?

Sample answer: A financial statement is similar to a balance sheet in that it provides relevant financial information in a structured manner. This provides the ability to oversee financial status and conditions.

5. What are the accounting standards?

Sample answer: Accounting standards are guidelines that accounting professionals should follow as it pertains to the organization and business type. These are a common set of standards, procedures, and operating policies that define the accounting practice within the organization.

6. What accounting software is used to handle accounting needs?

Sample answer: Quickbooks, Quicken, and Microsoft Excel are the most common forms of accounting software.

7. What is “cash flow”?

Sample answer: Cash flow is the net amount of cash and cash-equivalents being transferred into and out of a business. Cash flow is calculated by making certain adjustments to net income by adding or subtracting differences in revenue, expenses, and credit transactions.

8. What is a “cash flow statement”?

Sample answer: A cash flow statement is sometimes referred to as “cash flows”. It is a financial statement that shows how changes in balance sheet accounts and income are affecting cash and cash equivalents.

9. What is a fixed asset?

Sample answer: A fixed asset is sometimes referred to as a tangible asset or property. This would be equivalent to machinery and equipment or real estate property. This is a term used to describe assets that cannot be easily converted into cash.

10. What is a contingent liability?

Sample answer: A contingent liability is a liability contingent on the outcome of an event. For example, an uncertain future event like a pending lawsuit would be considered a contingent liability.

11. What is a ledger account?

Sample answer: A ledger account or “accounting ledger” is an account or record used to store bookkeeping entries. This ledger is then used as the entries that need to be placed into the balance sheet and income statement transaction. Accounting ledger entries can include cash, accounts receivable, investments, accounts payable, expenses, and other customer deposits.

12. What is a depreciation expense?

Sample answer: A depreciation expense is when a company allocates an asset’s cost through its useful life. When a company prepares financial statements, it records a depreciation expense to allocate a portion of the cost of the expense itself. This could be a building, machinery, equipment, or other operating equipment purchased in that fiscal year.

13. What is a bank reconciliation statement?

Sample answer: A bank reconciliation statement is a summary of banking and business activity. It reconciles an organization's bank account with its financial records. This includes deposits, withdraws, and other financial activities.

14. What would a tax accountant help with?

Sample answer: A tax accountant would help with tax strategies. This would be a professional who would help in assisting in the minimization of taxes or the elimination of tax payments.

15. What is a trial balance?

Sample answer: A trial balance is a list of all general ledger accounts contained in the ledger of a business. In short, it is a bookkeeping worksheet that compiles all of the credit and debit account columns totals into one balance.

16. What is an income statement?

Sample answer: An income statement or P&L (profit and loss statement) is a financial statement that shows a company the revenues and expenses during a particular period. This is calculated by looking at the net income or net profit after subtracting expenses, depreciation, and taxes.

17. What are tangible assets?

Sample answer: Tangible assets are similar to a fixed asset. This would be an asset that cannot be easily converted to cash. This includes real estate property, heavy machinery, and other operating equipment.

18. What is the accounting principle?

Sample answer: An accounting principle is a standard operating procedure that is followed and accepted by the accounting team. Accounting principles refer to the broad underlying concepts which guide accountants when preparing financial statements and following other financial protocols in the accounting profession.

19. What is a current asset?

Sample answer: A current asset or “current assets” can include cash, cash equivalents, accounts receivable, stock inventory, marketable securities, prepaid liabilities, and other liquid assets. Contrary to a tangible asset, which is more difficult to convert to cash, current assets are reasonably expected to be able to sell.

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author: patrick algrim
About the author

Patrick Algrim is an experienced executive who has spent a number of years in Silicon Valley hiring and coaching some of the world’s most valuable technology teams. Patrick has been a source for Human Resources and career related insights for Forbes, Glassdoor, Entrepreneur, Recruiter.com, SparkHire, and many more.

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