Accounting Transaction

                             Accounting Transaction 

The main function of an accountant is to record properly the financial transactions of a business concern in the books of accounts and to ascertain its true result at the year end. Thus the transaction is the foundation of accounting- the first and formest element of accounting. In a word, it is life and blood of accounting.Hence the accountant must have a fair idea about the term "transaction".

                              Defeinition Of Transaction 

                          " A business event which can be measured in terms of money 

                               and which have must be recorded in books of accounts."

                              Clasification Of Accounting 

transaction may be devided into three groups:

Cash Transaction:

         IF the value of transaction in met is cash immediately, it is called cash transaction . For example we buy furniture of Rs.2000 from Asif and immediately pay him in cash. It is a cash transaction

.

Credit Transaction:

         If  the value of the transaction is not met in cash immediately, it is called credit transaction.In the above example, if we do not pay Asif RS.2000 immediately, it will be credit transaction.

Paper Transaction:

       When there is no question of meeting the value of a transaction, it is regraded as a paper transaction.For example, I have lost the Rs.500. This changes my financial position-my properties decrease in value by Rs.500. But there is no question of meeting the value of such a transaction. This is a paper transaction.