Pabrai's Fresh and Naturelle Ice Cream Executive Accounts Accountant Interview Questions and Answers

Golden rules of accounting are basic principles that guide the process of recording financial transactions.

• The accounting equation must always be in balance: Assets = Liabilities + Equity

• Every transaction should be recorded in at least two accounts: Debit and Credit

• Debit the receiver, credit the giver

• Debit what comes in, credit what goes out

• Debit expenses and losses, credit income and gains

Depreciation is the allocation of the cost of a tangible asset over its useful life.

• Depreciation is a non-cash expense that reflects the decrease in value of an asset over time.

• It is used to spread the cost of an asset over its useful life instead of expensing it all at once.

• Common methods of calculating depreciation include straight-line, double declining balance, and units of production.

• Examples of depreciable assets...read more

Amortization is the process of spreading out the cost of an intangible asset over its useful life.

• Amortization is similar to depreciation, but it is used for intangible assets such as patents, copyrights, and trademarks.

• It helps allocate the cost of the intangible asset over its useful life to match the revenue it generates.

• Amortization expense is recorded on the income statement and reduces the asset's carrying value ...read more