Business event and business transaction
Event: In ordinary language event means anything that happen.
There are two types of event.
- Monetary event
- Non monetary event
Monetary event: Event which are related with money e.g., which change the financial position of the person known as monetary event .e.g., shopping marriage etc.
Non monetary event: Event which is not related with money, which do not change the financial position of the position of the person are known as non monetary event e.g., winning a game, delivering a lecture in a meeting etc.
In business accounting only those events which change the financial position of the business and which call for accounting are recognized as EVENT. In other words all monetary events are regarded business transaction.
Business transaction: Any dealing between two persons or thing is called transaction. It may relate to purchase and sales of goods, receipt, payment of cash and rendering service by one part to another.
Transaction is of two kinds.
- Cash transaction
- Credit transaction