Accounting treatment/ entry

Priyanka Kumar (Delhi) (33 Points)

03 August 2014  

Can anyone plz tell me the treatment of Earnest Money Deposit in the below situation:-

A Fixed Deposit is made of say Rs 1,00,000 and the same Fixed Deposit is given as security for the tender of subscriptttion of books and articles. 

My question is if we recongnise Fixed Deposit in our books than how to recongnize that such fixed deposit is given as earnest money deposit against a tender. And do, we have to book accrued interest on such Fixed Deposit in the above case. Plz provide me with the entry for giving Fixed Deposit as Earnest Money Deposit. Plz rply urgently.

Thanks In Advance