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Is security deposit of electricity a current asset


Ranjith (ACA)     23 April 2015

Ranjith
ACA 
 37 points

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Is security deposit for electricity a current asset or long term loans and advance ?Please explain

MASTER MIND

MASTER MIND (CA on Duty)     23 April 2015

MASTER MIND
CA on Duty 
 8 likes  104 points

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The security deposit paid to another entity is a current asset, if the security deposit will be returned within one year of the balance sheet date. The entity holding the security deposit will report it as a current liability, if it is to be repaid within one year of the balance sheet date.

If the security deposit will not be returned within one year of the balance sheet date, the security deposit is reported as a long-term asset by the entity paying the security deposit. The party holding the security deposit will report it as a long-term liability if it will not be returned within one year of the balance sheet date.

Neethi V. Kannanth

Neethi V. Kannanth (.)     20 January 2021

Neethi V. Kannanth
. 
 31 likes  1609 points

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How should the interest earned on electricity security deposit be treated?


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