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SPRING 2015 SOLVED ASSIGNMENT # 01 COURSE CODE 438 PRINCIPLES OF ACCOUNTING
Solved assignment # 01 for b.com student’s course code 431 is available for the spring 2015 semester. The whole solved assignment is uploaded in hard form.
Q 01: Ans:
BUSINESS TRANSACTION DEFINITION AND EXAMPLES.
Business transactions are the introduction between business and their customers, vendors, and others with whom they do business.
The accounting definition of a business the transaction is an economic event that imitates the accounting process of recording it in a company’s accounting system.
There are five types of transactions.
1) Simple transaction:– is a transaction in which only simple exchange is made e.g a man buy a cup of tea and paid amount against it. This type of transactions is called simple transaction.
2) Complex transaction:– Many transactions are complex. Purchasing an item with credit involves a series of transaction before the purchases can be completed do not manufacture the products they sell. Instead they buy products directly from manufacturers or whole seller, and then mark the prices up from what they paid to sell to customers to make a profit.
3) Business to Business Transaction:– Many companies sell products or services to other businesses and exclude and consumers from the business model completely, for examples a company might sell cloud storage to other companies, which are virtual servers that power websites and other technology. Setting up a vacation through a travel agency requires booking hotels, flights, possibly rail or boat travel tours and making other arrangements, all of which require business transaction.
4) On Going Transaction:– Some Business transactions are ongoing business transactions are ongoing your relationship with your bank is ongoing business transaction that may encompasses multiple types of transaction.
5) Whole seller to Retailer:– Another type of business transactions is when a retailer buys products from a manufacturer or whole seller.