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February 9, 2009

Is a security deposit a current asset?

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.

Learn more about the Balance Sheet.

the accounting coach

About the Author: Harold Averkamp (CPA) has worked as an accountant, consultant, and university accounting instructor for more than 25 years.

He is the author of the 2010 Master Accounting Download Package which has been praised for it's ability to simplify accounting in a way that anybody can understand.



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Comments

2 Responses to “Is a security deposit a current asset?”

  1. ernesto on February 14th, 2009 6:33 am

    i dont know what is security deposite. kindly explain it in a laymans idea for me. thank you

  2. mustafe on December 20th, 2009 12:42 pm

    i dont know what is certificaet. explain it . and i can’t understand A/recieve pleace explain and help me thank you for everythings

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