Sir,
I want to prepare a P&L account sheet estimated mannualy, my query is can i post Security Deposited amount in expenses site which i deposited to my client ?
Menu
PROFIT AND LOSS ACCOUNT
Replies (2)
Quick Summary
Create an asset which has the characteristics of a liability in the asset form which needs to be realised.
Security deposit a/c -assets
To creditors a/c -liabilities
when payment is made:
Security deposit expense a/c
To Bank a/c
when you loose the deposit:
SPLOCI-PL
To Security deposit a/c
But the above procedure is wrong because you are actually expensing and adding loss over it to profit and loss. So, to be prudent in recording journal entries, the following method is best:
Security deposit a/c -asset
To Bank a/c
when you loose your deposit:
Loss on deposit a/c p&l
To Security deposit a/c -asset
For this purpose, you don’t recognise it as an expense in accruals because you will always get that amount back
Thank You Sir !
Recent Topics :
- Looking for practising CA
- TDS return filing
- Need formats of FS as per Co act 2013 in soft copy
- Remittance to italy
- Invoice made but goods not sent
- How Do CA Firms Manage Client Document Collection
- How do CA firms manage pending client documents du
- How to find a good CA
- Rcm on rent paid
- Clarify on GST Application
Related Topics :
CAclubindia
