Question 1. What Is Computerized Accounting?
Accounting is the method wherein monetary records is amassed, processed, and summarized into economic statements and reports.
The cause of accounting is to offer statistics used in selection-making. Accounting can be viewed as a device (a procedure) that converts records into beneficial information.
Information strategies encompass:
Every enterprise has numerous tactics. Some are simple, others complicated and cumbersome. However, because the enterprise grows, acquires new clients, enters new markets, and maintains pace with steady changes in statutory policies... The organisation will need to hold noticeably accurate and up-to-date accounting, inventory, and statutory facts.
This is wherein a automated accounting facilitates simplify, combine, and streamline all of the enterprise techniques, cost-efficiently and without difficulty.
Question 2. What Are The Problems Faced In Computerized Accounting System?
Problems Faced In Computerized Accounting System:
User Training: The person, for the use of pc accounting software, desires to understand the ideas of the software. Hence, he need to undergo right education. A computer operator must examine the basics of pc, ideas of software program, running with the operating gadget software [such as Windows/DOS] and the accounting software.
System Dependency: Using a pc answer makes the person to rely fully on the computer machine and necessitates the provision of pc always. If the device is not to be had [due to hardware failure or power cut], it might be difficult to affirm the debts.
Hardware Requirements: A complete-fledged laptop machine with a printer is needed to perform the automatic accounting device. Most small groups may not find the money for to have such facility with essential software.
System Failure: When there is a device crash [hard disk crash], there is excessive risk of losing the information to be had at the hard disk force at any factor of time. It might be distinctly painful, if the hassle takes place at stop of the monetary 12 months, whilst the financial statements must be prepared.
Backups and Prints: Backups of the statistics need to be performed often so that, whilst the information is lost, it may be restored from floppies [backups]. Regular print outs of the system facts might be useful as manual records.
Voucher Management: Accounting software allows smooth alteration of information. If a voucher is badly located in a incorrect head, it might be very tough to kind out and convey back the voucher. A suitable voucher management could be very vital.
Security: Additional security needs to be furnished because incorrect managing of the device [hardware/software] can be dangerous. Passwords, locks, etc., have to be set so that no unauthorized individual can cope with the device.
Peachtree Accounting Interview Questions
Question 3. What Are The Advantages Of Computerized Accounting?
Advantages of Computerized Accounting:
Better Quality Work: The accounts prepared with the use of computers are typically uniform, neat, accurate, and greater legible than guide activity.
Lower Operating Costs: Computer is a hard work and time saving devise. Hence, the quantity of job handled with the assist of computers results in financial system and decrease operating charges.
Improved Efficiency: Computer brings speed and accuracy in getting ready the information and debts and for that reason, increases the performance of employees.
Facilitates Better Control: From the control factor of view, greater manipulate is viable and greater data can be available with the use of computer in accounting. It ensures efficient overall performance in accounting paintings.
Greater Accuracy: Computerized accounting ensures accuracy in accounting facts and statements. It prevents clerical mistakes and omissions.
Relieve Monotony: Computerized accounting reduces the monotony of doing repetitive accounting jobs, that are tiresome and time consuming.
Facilitates Standardization: Computerized accounting helps standardization of accounting workouts and processes. Therefore, standardization in accounting is ensured.
Minimizing Mathematical Errors: While doing arithmetic with computer systems, mistakes are honestly eliminated except the facts is entered improperly in the first instance.
Question four. What Are The Disadvantages Of Computerized Accounting?
Disadvantages of Computerized Accounting:
Reduction of Manpower: The introduction of computers in accounting paintings reduces the wide variety of employees in an agency. Thus, it leads to extra amount of unemployment.
High Cost: A small company cannot deploy a laptop accounting system because of its high installation and protection value. To be more low-budget there need to be large volume of labor. If the device isn't used to its complete capacity, then it'd be especially uneconomical.
Require Special Skills: Computer gadget requires especially specialised operators. The availability of such skilled employees is very scarce and really highly-priced.
Other Problems: Frequent restore and power failure may additionally have an effect on the accounting work very an awful lot. Computers are vulnerable to viruses. Often time’s human beings will anticipate the pc is doing matters efficaciously and troubles will pass unchecked for lengthy time frame.
Question five. Describe The Various Types Of Accounting Software?
The diverse styles of accounting software are:
General Accounting Interview Questions
Question 6. Explain Ready-to-use Software?
This sort of software program is quite simply to be had within the marketplace with prescribed and preferred capabilities. This accounting software program is essentially utilized by the small-length business companies, where the number of transactions isn't always so big. The value of its installation and maintenance is also low. It has confined wide variety of customers. Its adaptability could be very high as it's miles especially less complicated to analyze and perform. It does now not have a extensive scope to link it with other facts structures.
Question 7. Explain Customized Software?
Customized software is the software program that has standardized features to satisfy the unique requirements of the customers. It offers the scope of converting the features of accounting software. The features of this software can be programmed as according to the needs and requirements of the customers. This sort of software nice fits the desires of medium and massive organizations. Its value of installation and protection is relatively higher. It can be without problems Linked to the alternative facts systems.
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Question 8. Explain Tailored Software?
Tailored or Tailor-made accounting software program is the software program that is advanced as in step with the specifications and requirements of the users. This accounting software program is commonly used within the Large business companies with multi-customers and geographically scattered places. It is designed to satisfy the precise desires of the customers and form an quintessential a part of the organizational MIS. It has infinite range of users .
Question nine. What Are The Advantages And Disadvantages Of Ready-made Accounting Software?
Advantages of Ready-made Accounting Software :
This software program is without difficulty to be had inside the market.
It is much less pricey, as it comes with simple and widespread features.
It entails a lesser need for training.
It is less state-of-the-art
Its adaptability could be very excessive as it is exceptionally less difficult to examine and perform.
It is suitable for small-size commercial enterprise organizations.
Disadvantages of Ready-made Accounting Software :
It has restricted variety of users
It isn't suitable for medium and big commercial enterprise agency. Wherein the number of transactions could be very massive.
It fails to cater the particular wishes of the customers.
It suffers from the low level of records secrecy.
It does no longer have a wide scope to hyperlink at with different information structures.
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Question 10. What Are The Advantages And Disadvantages Of Tailor-mad. Accounting Software?
Advantages of Customised and Tailor-mad. Accounting Software :
This software program is appropriate for medium and huge commercial enterprise company.
It caters the precise necessities and wishes of the users.
It may be modified as consistent with the desires of the organization.
It has excessive degree of safety and minimizes the loss and unauthorized get entry to of data.
It can not be easily mutated or duplicated in the market due to distinction inside the wishes and necessities of various customers.
It does now not contain excessive fee of training because the schooling can be imparted in the corporation by means of the experienced personnel.
It can be effortlessly Linked to the opposite data structures.
It paperwork an necessary part of the organizational MIS.
Disadvantages of Customized and TaiLor-made Accounting Software :
It entails excessive cost of set up and preservation.
Developing customized software program is a music-consuming method and includes excessive value of development,
Maintenance of this software program is difficult as there exists restricted avalibilty of information to the developers.
It lacks widespread education modules.
Question eleven. Distinguish Between A Manual And Computerised Accounting System?
The principal difference between manual and automatic systems is pace. Accounting software program procedures information and creates reviews a whole lot faster than guide systems. Calculations are executed automatically in software programs, minimizing errors and growing performance.
The Main distinction is:
Speed : The essential difference among manual and automatic structures is speed. Accounting software program processes data and creates reports a good deal quicker than manual structures. Calculations are accomplished routinely in software packages, minimizing errors and growing efficiency. Once records is input, you could create reviews actually with the aid of pressing a button in a automated device.
Cost : Another distinction among manual and computerized structures is fee. Manual accounting with paper and pencil is a great deal cheaper than a automatic gadget, which requires a device and software program. Other expenses related to accounting software program include schooling and software preservation. Expenses can upload up fast with costs for printers, paper, ink and other components.
Backup : A third difference among guide and automated systems is the ease of backup of a automated machine. All transactions can be stored and backed up, in case of hearth or different mishap. You can't try this with paper records, until you're making copies of all pages--a long and inefficient method.
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Question 12. How Do Automatic Bank Drafts Work?
Automatic Payments : When used synonymously with computerized price plans, automated financial institution drafts are a convenient and paperless way of paying bills wherein price range are debited from one account and credited to some other.
ACH System : The Automated Clearing House computerized system methods electronic debit and credit score transactions for financial institutions with the assistance of the Federal Reserve. Through the ACH gadget, price range are moved quick from one account to some other electronically and not using a paperwork.
Terminology : A business trying to simply accept automated bank drafts for ongoing everyday payments or pay payments the use of automated financial institution drafts can installation the procedure with the best economic group. Consumers offered this option to pay bills can then authorize the manner and begin everyday financial institution drafts to pay recurring bills.
Peachtree Accounting Interview Questions
Question thirteen. ‘computerised Accounting Systems Are Best Form Of Accounting System’. Do You Agree?
Accounting refers to identifying transactions and occasions of economic nature, document them within the books of account and produce meaningful facts for the users. Thus, the most feature of accounting is to become aware of transactions and activities of monetary nature and document them inside the books of account.
Accounting process method preparing vouchers for the transactions, writing them inside the Journal, posting the recorded transactions inside the Ledger Accounts,drawing Trial Balance and thereafter, making ready the Financial Statements, i.E.,Trading Account, Profit and Loss Account and Balance Sheet.
The accounting method, whether done manually or by way of use of computer systems generates accounting records which include Cash Book, Bank Book, Journal,Purchases Book, Sales Book, Ledger and Trial Balance. Besides the accounting statistics sure reports consisting of Payroll, Stock Report, Statutory Returns (VAT,CST, and many others)., Debtors Report, Creditors Report and Exception Report., and so on., also are prepared below both the technique.
When the accounting is accomplished by way of computers, the accounting system stays exactly the same besides that posting of recorded transactions to the ledger accounts and additionally the totaling of man or woman bills and drawing of trial balance is carried by the computer systems with the assist of softwares.
An example of Operating Software is "Windows", "Windows XP" and "Windows Vista" and so on. Accounting function is accomplished utilising accounting software program. Accounting softwares fall in the category of "Application Softwares". The stop manufactured from accounting method is producing monetary statements, i.E., Trading, Profit and Loss Account and the Balance Sheet and the accounting softwares are so designed that the monetary statements are produced through the device itself. A credible financial declaration may be prepared if the accounting ideas and standards are observed. It always method capital expenditure and capital income or receipts be transferred to Balance Sheet at the same time as sales expenditure and revenue incomes be transferred to Trading, Profit and Loss Account. This objective of accounting can be finished whilst the account heads are defined in a manner that capital expenses and capital earning form part of the Balance Sheet beneath suitable major head. Similarly, sales expenditure and revenue earning form part of the Trading, Profit and Loss Account. The system by which this goal is carried out is known as "Grouping of Accounts".
The technique of "Grouping of Accounts" is completed by way of giving a code to each primary head, sub- heads and thereafter man or woman account heads. Code of the main head signifies whether the account is an object belonging to property, liabilities, prices or earning. Code of the sub-head indicates the top beneath which individual account head will seem. Account if wrongly coded, will lead to errors of principle wherein an item of liability may be handled as earnings and vice versa. Similarly, an object of asset may be treated as expense and vice versa. The economic statements prepared with out rectifying such mistakes will reveal wrong monetary results and role.
Therefore, severe caution desires to be exercised whilst grouping of bills is achieved and also while the transaction is recorded the usage of computers.
Question 14. ‘accounting Software Is An Integral Part Of The Computerised Accounting System’ Explain. Briefly List The Generic Considerations Before Sourcing An Accounting Software.
It is important to remember a few factors before sourcing an accounting software, i.E.,
1. Flexibility – A automated accounting system have to be flexible in respect of statistics entry, retrieval of data and generating designs of report. The user must be capable of run the software program on a spread of pc environments and machines, this is, on any configuration of computers and available running structures.
2. Cost of Installation and Maintenance – It is a ought to to recall that the fee of the accounting software program, its relevant hardware and the preservation, value of addition of modules, education of team of workers, updating of versions and facts recovery in case of statistics failure are negotiable and within the capability of the organization to find the money for it.
3. Size of organization – An accounting device have to be in keeping with the scale of the organization, i.E., extent of enterprise transactions,multi – user necessities.
4. Ease of Adaptation and Training Needs – a few accounting softwares are user – pleasant and require a easy training to the customers. However, a few different complicated software programs, connected to other statistics structures, require extensive training on a non-stop basis. The software program need to be capable of attracting users.
5. Expected Level of Secrecy (Software and Data) – Security capabilities of an accounting device software are also essential. Software must make certain that it prevents unauthorized get entry to and manipulation of data. In tailor-made software,the consumer rights may be restrained in line with the departments and their relevant accounting software capabilities.
6. Exporting/Importing Data Facility – The software program need to permit easy statistics switch alternative for flexible reporting, including transfer of facts at once from the ledger into the spreadsheet software like Lotus or Excel
Question 15. Give Two Examples Each Of The Organisations Where ‘geared up-to-use’, ‘customised’,and ‘tailored’ Accounting Packages Respectively Suitable To Perform The Accounting Activity.
The time period ‘ Customised Software’ manner making changes in the readymade software to healthy the specific requirements of the person, i.E., making it person – unique. The software program to be had off-the-shelf is modified to in shape the requirements of the person. For example, the layout of the bill is modified to the specs of the person. The developer, to meet particular user necessities, can adjust all the readymade softwares.
The term ‘Tailor – made software program’ refers to designing and growing consumer –These softwares, being consumer – particular, aren't available off – the shelf however are evolved to fulfill the requirement of the user on the premise of discussion between the customers and the builders.
Readymade softwares are the softwares which can be developed now not for any specific user however for the customers in popular. Since, the readymade softwares are for preferred consumer, it isn't necessary that each one the modules of such softwares are of use for every consumer. It is probably that a particular module says ‘Payroll’ might also ndot be used due to the fact the company has very few personnel.
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Question 16. Give Examples Of Two Types Of Operating Systems.
Unix and Linux are examples of multi-person working structures used to handle.
Voluminous information and complex reporting necessities.
Question 17. State The Four Basic Requirements Of A Database Applications?
The four fundamental necessities of database programs are
Back-give up database.
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Question 18. Distinguish Between ‘ready-to-use’ And ‘tailored’ Accounting Software.?
Ready-to-Use Accounting Software :
This software program is utilized in small and traditional businesses.
Its adapatability may be very excessive.
Its interface with the other facts machine is restricted.
It has limited customers.
The set up and preservation cost is Low.
Tailored Accounting Software :
This software is utilized in huge and normal agencies.
Its adaptability could be very specific and can not be utilized by each commercial enterprise houses.
Its interface with the opposite records device is limitless.
It has large quantity of users.
The installation and protection price is relatively better.
General Accounting Interview Questions
Question 19. What Is The Need Of Computerized Accounting?
Need for Computerized Accounting:
The want for computerized accounting arises from benefits of pace, accuracy and decrease value of handling the business transactions.
Numerous Transactions: The automatic accounting machine is able to huge wide variety of transactions with pace and accuracy.
Instant Reporting: It is able to presenting short and high-quality reporting because of its pace and accuracy.
Reduction in Paper Work: Manual accounting device requires massive garage space to preserve accounting facts/books, and vouchers/documents. The requirement of books and stationery and books of money owed along side vouchers and files is without delay dependent on the extent of transactions past sure point.
There is a dire need to reduce the paper work and dispense with big quantity of books of account. This may be executed with the help of automatic accounting gadget.
Flexible Reporting: The reporting is bendy in automated accounting machine. It is able to generating reports of any stability as while required and for any length that's inside the accounting period.
Accounting Queries: There are accounting queries, which are primarily based on a few outside parameters. For example, a query relating to late clients’ debts can be without problems spoke back by means of using the based query language [SQL] help of database era inside the computerized accounting device. Such an workout could be pretty tough and high-priced in manual accounting system.
Online Facility: Computerized accounting system gives online facility to store and manner transaction information with a view to retrieve records to generate and look at monetary reports.
Accuracy: The information and reports generated are accurate and pretty reliable for selection-making. In manual accounting system, as many human beings do the activity and the volume of transactions is pretty massive, such statistics and reviews are likely to be distorted and unreliable and erroneous.
Security: This machine is quite secured and the facts and statistics can be kept private, when compared to guide accounting system.
Scalability: The machine can cope easily with the growth in the extent of commercial enterprise. It calls for simplest additional facts operators for storing additional vouchers.
Question 20. What Is Computerized Payroll Accounting?
Computerized payroll accounting structures allow you to procedure all of your regular payroll tasks thru a computerized gadget, in place of via hand. Essentials like name, cope with, Social Security range and withholding rate for every worker are robotically stuffed in for each pay length until you're making an employee’s report inactive. Many one of a kind vendors provide automatic payroll structures. Like special phrase processors or other pc programs, they in large part provide the same types of features with barely distinct interfaces.
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