Handle Deposits - Revision history

Khkoh: /* Receiving the Security Deposit */

2026-07-15T07:59:44Z

Receiving the Security Deposit

← Older revision		Revision as of 15:59, 15 July 2026
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	# When the customer pays the security deposit, record the amount against the Customer Security Deposits liability account.		# When the customer pays the security deposit, record the amount against the Customer Security Deposits liability account.
			# To do that, navigate to Finance Mgt, Process General Receipt, At the From pull-down menu. select Customer.
			# Then, enter the customer name and Branch name. Fill in the table and select a suitable GL account. Please check with the accountant which account should be used. Or, create a GL Code for "Customer Security Deposit".
	# The accounting entry will generally be:		# The accounting entry will generally be:
	## Debit: Bank		## Debit: Bank

Khkoh: /* How to Handle a Customer's Security Deposit */

2026-07-15T07:56:51Z

How to Handle a Customer's Security Deposit

← Older revision		Revision as of 15:56, 15 July 2026
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	=== Create a Liability Account ===		=== Create a Liability Account ===
	~~In the Chart of Accounts, create an account such as:~~

	Customer Security Deposits		# In the Chart of Accounts, create an account such as:
			# Customer Security Deposits
	The account should be classified as a '''Liability Account'''.		# The account should be classified as a '''Liability Account'''.

	=== Receiving the Security Deposit ===		=== Receiving the Security Deposit ===
	~~When the customer pays the security deposit, record the amount against the Customer Security Deposits liability account.~~

	The accounting entry will generally be:		# When the customer pays the security deposit, record the amount against the Customer Security Deposits liability account.
			# The accounting entry will generally be:
	Debit: Bank		## Debit: Bank
			## Credit: Customer Security Deposits
	Credit: Customer Security Deposits		## The deposit is therefore shown as an amount owed back to the customer and is not included as sales income.

	The deposit is therefore shown as an amount owed back to the customer and is not included as sales income.

	=== Returning the Security Deposit ===		=== Returning the Security Deposit ===
	~~When the leasing agreement ends and the deposit is refunded:~~

	Debit: Customer Security Deposits		# When the leasing agreemt ends and the deposit is refunded:
			## Debit: Customer Security Deposits
	Credit: Bank		## Credit: Bank
			## This clears the security depenosit liability.
	This clears the security ~~deposit~~ liability.

	=== If Part of the Deposit Is Forfeited or Used ===		=== If Part of the Deposit Is Forfeited or Used ===
	~~If part of the security deposit is used to settle unpaid rental, damage charges or other agreed charges, the relevant amount should first be applied to the appropriate invoice or income account.~~

	Any remaining refundable balance should be returned to the customer.		# If part of the security deposit is used to settle unpaid rental, damage charges or other agreed charges, the relevant amount should first be applied to the appropriate invoice or income account.
			# Any remaining refundable balance should be returned to the customer.

	=== Summary ===		=== Summary ===
	~~Refundable security deposit → Liability~~

	~~Not Rental Income~~

	~~Not Sales Income~~

	~~Not Cost of Goods Sold~~

	Refunded at end of lease, subject to the leasing agreement		# Refundable security deposit → Liability
			# Not Rental Income
			# Not Sales Income
			# Not Cost of Goods Sold
			# Refunded at end of lease, subject to the leasing agreement

Khkoh: /* How to Handle a Customer's Security Deposit */

2026-07-15T07:55:26Z

How to Handle a Customer's Security Deposit

← Older revision		Revision as of 15:55, 15 July 2026
Line 6:		Line 6:
	This is because the money may need to be returned to the customer at the end of the leasing period.		This is because the money may need to be returned to the customer at the end of the leasing period.

	=== 1. Create a Liability Account ===		=== Create a Liability Account ===
	In the Chart of Accounts, create an account such as:		In the Chart of Accounts, create an account such as:

Line 13:		Line 13:
	The account should be classified as a '''Liability Account'''.		The account should be classified as a '''Liability Account'''.

	=== 2. Receiving the Security Deposit ===		=== Receiving the Security Deposit ===
	When the customer pays the security deposit, record the amount against the Customer Security Deposits liability account.		When the customer pays the security deposit, record the amount against the Customer Security Deposits liability account.

Line 24:		Line 24:
	The deposit is therefore shown as an amount owed back to the customer and is not included as sales income.		The deposit is therefore shown as an amount owed back to the customer and is not included as sales income.

	=== 3. Returning the Security Deposit ===		=== Returning the Security Deposit ===
	When the leasing agreement ends and the deposit is refunded:		When the leasing agreement ends and the deposit is refunded:

Line 33:		Line 33:
	This clears the security deposit liability.		This clears the security deposit liability.

	=== 4. If Part of the Deposit Is Forfeited or Used ===		=== If Part of the Deposit Is Forfeited or Used ===
	If part of the security deposit is used to settle unpaid rental, damage charges or other agreed charges, the relevant amount should first be applied to the appropriate invoice or income account.		If part of the security deposit is used to settle unpaid rental, damage charges or other agreed charges, the relevant amount should first be applied to the appropriate invoice or income account.

Khkoh at 07:55, 15 July 2026

2026-07-15T07:55:03Z

← Older revision		Revision as of 15:55, 15 July 2026
Line 1:		Line 1:
	__FORCETOC__		__FORCETOC__

			== How to Handle a Customer's Security Deposit ==
			A refundable security deposit received from a customer should '''not be recorded as income'''.

			This is because the money may need to be returned to the customer at the end of the leasing period.

			=== 1. Create a Liability Account ===
			In the Chart of Accounts, create an account such as:

			Customer Security Deposits

			The account should be classified as a '''Liability Account'''.

			=== 2. Receiving the Security Deposit ===
			When the customer pays the security deposit, record the amount against the Customer Security Deposits liability account.

			The accounting entry will generally be:

			Debit: Bank

			Credit: Customer Security Deposits

			The deposit is therefore shown as an amount owed back to the customer and is not included as sales income.

			=== 3. Returning the Security Deposit ===
			When the leasing agreement ends and the deposit is refunded:

			Debit: Customer Security Deposits

			Credit: Bank

			This clears the security deposit liability.

			=== 4. If Part of the Deposit Is Forfeited or Used ===
			If part of the security deposit is used to settle unpaid rental, damage charges or other agreed charges, the relevant amount should first be applied to the appropriate invoice or income account.

			Any remaining refundable balance should be returned to the customer.

			=== Summary ===
			Refundable security deposit → Liability

			Not Rental Income

			Not Sales Income

			Not Cost of Goods Sold

			Refunded at end of lease, subject to the leasing agreement

Khkoh: Created page with "FORCETOC"

2026-07-15T07:54:41Z

Created page with "__FORCETOC__"

New page

__FORCETOC__

Handle Deposits - Revision history

Khkoh: /* Receiving the Security Deposit */

Khkoh: /* How to Handle a Customer's Security Deposit */

Khkoh: /* How to Handle a Customer's Security Deposit */

Khkoh at 07:55, 15 July 2026

Khkoh: Created page with "__FORCETOC__"

Khkoh: Created page with "FORCETOC"