How does SQL Server locking work in this scenario?

BEGIN TRANSACTION
DECLARE MONEY @amount
SELECT Amount AS @amount
  FROM Deposits
  WHERE UserId = 123
UPDATE Deposits
  SET Amount = @amount + 100.0
  WHERE UserId = 123
COMMIT

CREATE TABLE Deposits(Amount Money, UserID int)
INSERT INTO Deposits (Amount, UserID)
SELECT 0.0, 123
--Reset
UPDATE Deposits
SET Amount = 0.00
WHERE UserID = 123

SET TRANSACTION ISOLATION LEVEL Serializable
----------------------------------------
-- Part 1
----------------------------------------
BEGIN TRANSACTION
DECLARE @amount MONEY
SET @amount =
(
SELECT Amount
FROM Deposits
WHERE UserId = 123
)
SELECT @amount as Amount
----------------------------------------
-- Part 2
----------------------------------------
DECLARE @amount MONEY
SET @amount =  *value from step 1*
UPDATE Deposits
SET Amount = @amount + 100.0
WHERE UserId = 123
COMMIT
SELECT *
FROM Deposits
WHERE UserID = 123

1 T1.@Amount = 0.00
2 T1.@Amount = 0.00
3 Deposits.Amount = 100.00
4 Deposits.Amount = 100.00

1 T1.@Amount = 0.00
2 T1.@Amount = 0.00
3 Deposits.Amount = 100.00
4 Deposits.Amount = 100.00

1 T1.@Amount = 0.00 (locks out changes by others on Deposit.UserID = 123)
2 T1.@Amount = 0.00 (locks out changes by others on Deposit.UserID = 123)
3 Hangs until step 4. (due to lock in step 2)
4 Deadlock!
Final result: Deposits.Amount = 100.00

1 T1.@Amount = 0.00 (locks out changes by others on Deposit)
2 T1.@Amount = 0.00 (locks out changes by others on Deposit)
3 Hangs until step 4. (due to lock in step 2)
4 Deadlock!
Final result: Deposits.Amount = 100.00

UPDATE Deposits
SET Amount = Amount + 100.0
WHERE UserId = 123

BEGIN TRANSACTION
DECLARE MONEY @amount
SELECT Amount AS @amount
  FROM Deposits
  WHERE UserId = 123
UPDATE Deposits
  SET Amount = @amount + 100.0
  WHERE UserId = 123 AND Amount = @amount
IF @@ROWCOUNT <> 1 BEGIN ROLLBACK; RAISERROR(...) END
ELSE COMMIT END

BEGIN TRANSACTION
DECLARE MONEY @amount
SELECT Amount AS @amount
  FROM Deposits WITH(UPDLOCK)
  WHERE UserId = 123
UPDATE Deposits
  SET Amount = @amount + 100.0
  WHERE UserId = 123
COMMIT