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Deposit received

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Deposit received

Viewing 2 posts - 1 through 2 (of 2 total)
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  • April 14, 2019 at 12:51 pm #512367
    nikaido
    Member
    • Topics: 41
    • Replies: 89
    • ☆☆

    i was going through the past exam paper, the entity received a deposit in respect of an asset due for a completion. if the entity failed to complete the asset the deposit would be returned, although the examiner didnt touch on the treatment of deposit received i was wondering what would be the double entry for the deposit received

    Dr, Bank ( deposit )

    Cr ???

    TID and regards

    April 16, 2019 at 8:54 pm #513161
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7217
    • ☆☆☆☆☆

    Hi,

    It would be treated as deferred income and released to profit or loss once the asset is complete. If it isn’t completed then we reverse the original entry.

    Thanks

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