Explain about accounting transaction, Accounting Basics

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Q. Explain about Accounting transaction?

An accounting transaction is a business event or activity that causes a measurable change in the accounting equation Assets = Liabilities + Stockholders' equity. A trade of cash for merchandise is a transaction. The exchange occurs at an agreed price that provides an objective measure of economic activity. For instance the objective measure of the exchange may be USD 5000. These two factors measurement and evidence make possible the recording of a transaction. Only placing an order for goods isn't a recordable transaction because no exchange has taken place.


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