deferred gain is a liability because it constitutes something that you already received but have not really earned. just incase you wont be able to fulfill your contract (to do or to deliver something) then you are liable to return whatever was received. as for whatever was received for the deferred gain (account debited when the deferred gain was recorded), it is of course an asset.
I suppose it depends upon the circumstances. If you are talking about prepaid income, then the cash received is an asset, and the prepaid income account should be a liability. On the other hand, if you are talking about an installment sale, then the deferred gain is more in the nature of an asset that will be replaced by the cash when it is received — like an account receivable.
Why do you ask the question?
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is deferred gain an asset or liability?
Better answer. When coles were taken over by wesfarmers the shareholders in coles received two compnenents; a cash component and shares in wesfarmers. Out of this there arose a taxable capital gain. Now those shareholders could if they wished pay CGT on the whole amount or they could pay CGT on the amount applicable to the cash component and then defer the tax on the share compenent until the they sold the wesfarmers shares. Now by doing the former they established a higher cost base for the new wesfarmers held. By doing the latter the calculated cost base of the wesfarmers share is the original cost base applicable to the coles shares that were converted into wesfarmer shares. A capital gain may then arise or not on the sale of the wesfarmers shares. One pays tax now the other may or may not depending on movement in the market.