How do you record a deposit on utilities?
A deposit on utilities is recorded with a debit to the asset account Utilities Deposit and a credit to the asset account Cash. The account Utilities Deposit will be reported as a current asset if the company expects the amount to be returned by the utilities within one year of the balance sheet date. If the deposit will not be returned within one year of the balance sheet date, it will be reported as a long-term asset.
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what is the meaning of present value.
The other side of the equation: on the books of the utility company, its customers’ deposits are recorded as liabilities since they will be paid back to the customers after certain conditions are met. When the customer’s deposit is received, the utility company debits cash and credits Utility Deposits Payable.