Identifying a business transaction

Topic

Identifying a business transaction

Instructions

What criteria are considered when identifying a business transaction?

Answer preview

Largely used in reflection of accounting perspective, business transaction is any event in a business that initiates accounting process of recording within the firm’s accounting system. In a simplified manner, business transaction is can be classified as activity or event that has an impact on financial position of operation for a company. Once a business transaction has occurred, the capital, assets, and liabilities are affected.

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