Question

Received security deposit from tenants accounting equation

Answer 1

The equation will be,

Cash A/C Dr. xxxx

To Security Deposit A/C xxxx

The business has received cash from the tenant, hence Cash as Asset will increase.

The cash represents a security deposit as it will be returned to the tenant at the end of the agreement period.

Thus, it will be a liability and will be shown on the Liability side of the Balance Sheet.

Answer 2

question: received security deposit from tenants