# Finance accounting summer intern Interview Questions

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Finance Accounting Summer Intern interview questions shared by candidates### At a party everyone shakes hands, 66 hand shakes occur, how many people are at the party?

9 Answers↳

12

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You can suppose there are n people in the room and think of them in a row. The first one has to shake hands with (n-1) people (because he doesn't have to shake hands with himself). The second one has already shaken hands with the first one, so he has (n-2) shakes remaining... and so on. So you have to sum: (n-1)+(n-2)+(n-3)+...+1= (n/2)*(n-1) Then you have to solve (n/2)*(n-1)=66 and you get n=12. Less

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n(n-1)/2=66 so n=12

### You have a Balance Sheet, Income Statement, and a Cash Flow statement. If you could choose two out of the three statements, which two would you choose and why?

6 Answers↳

You can make the SCF from BS and IS

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This is a straight accounting question. You can make Cash Flow from Balance Sheet and Income Statement, so BS and IS is the answer! Less

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@hussein: There is only one correct answer, and it is the Balance Sheet and Income Statement. Less

### There are two stocks with the same expected value, with variance 0.3 and 0.2 and correlation 0.5. What proportion of each stock do you invest in to yield a minimum risk portfolio?

5 Answers↳

17/44 of the stock with variance of .3 and 27/44 from the stock with variance of .2 Less

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No, if you can short, the variance could be reduced even further since the stocks are correlated. Less

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Above answers used variance in portfolio variance equation, rather than std. Answer is .386 for security with var .3, and .613 for security with var .2 Less

### A use 5 hours finish a job. B use 8 hours finish it. How long A and B take it together?

4 Answers↳

I mean it is not correct (but probably I do not have got true): 1 hour A can make 20% (1/5) B can make 12.5% (1/8) A+B can make 32.5% (1/5 + 1/8 = 13/40) The work will be finished at 100% (1) 1 hour - 32.5% (13/40) x hour - 100% (1) x = 1*1/(13/40) = 40/13 = 3.077 (hours) tha half of the equation was good, but: 8 = X + 1.6*X = 2.6X; -> x=8/2.6) Please post a comment if I do not have true!!! Less

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40/13

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http://brainteaserbible.com/interview-brainteaser-andy-and-ben-working-together

### If W is standard Brownian Motion, for what values of n is W^n still a martingale?

3 Answers↳

By Ito W^n is a martingale for n=0,1

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Agree, for any n>1 you get a drift term

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Xt is a martingale you get f(Xt) is a martingale if f is linear otherwise convexity or concavity will increase or decrease the expectation, think of Jensen inequality. Less

### Evaluate the integral from 0 to pi/6 of sec(x) dx.

3 Answers↳

ln(root 3)

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ln(3)/2

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Reaching back to high school, I'd say -.5

### How would you value X company? Calculate FCF, working capital, enterprise value, etc. Does anything strike you as odd about these financial statements? Which? Why?

2 Answers↳

DCF, transaction comps, trading comps. FCF= NI +D/A -change in net working capital -capex. Working capital = current assets- current liabilities. Enterprise value = market cap + debt - cash + minority interest/pref shares. Less

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For FCF ... assuming FCF to the firm, i.e. FCFF, I think the "interest paid" needs to be added back. Working capital, depending upon data given, narrowed down to (Inventories + A/c Receivables - A/c Payables). Less

### If given $100 to invest today and you earn 10% the first year, and then reinvest all the money and lose 10% the next year, do you end up with a gain or a loss?

2 Answers↳

Loss

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you have a loss by 1 Rupee