A business transaction is an economic activity of the business that changes its financial position .Wherever any business transaction takes place ,it results in a change In the value of some of the assets, liabilities or capital.

Features of business transaction

• It involve some economic activities when goods are sold or purchased or some expense are paid
• Transaction are of two types internal and external transaction .External transaction involves economic activities between two parties such as purchase sales etc. Whereas internal transaction involves transaction entirely within business such as depreciation on fixed assets
• Only those activities are recorded which can be measure in terms of money only.