Define Financial Transaction.
Class 11 Accountancy Question
Answers
Answer:
A financial transaction is an agreement, or communication, carried out between a buyer and a seller to exchange an asset for payment.
Examples of financial transactions include cash receipts and deposit corrections.
Answer:
A financial transaction is an agreement, or communication, carried out between a buyerand a seller to exchange an asset for payment.
Financial transaction involving moneyand agricultural goods at a farmers' market
It involves a change in the status of the finances of two or more businesses or individuals. The buyer and seller are separate entities or objects, often involving the exchange of items of value, such as information, goods, services, and money. It is still a transaction if the goods are exchanged at one time, and the money at another. This is known as a two-part transaction: part one is giving the money, part two is receiving the goods
A financial transaction always involves one or more financial asset. Either buyer or seller can initiates such a transaction, hence one is the originator/initiator and the other is the responder. From liquidity point of view, one is the liquidity provider, the other party is the liquidity consumer. The liquidity provider is also called offer and the liquidity consumer is also called taker. While bidder and asker are much more confusing. Some people use both bid & ask for liquidity provision, while some other people use offer & ask for liquidity provision.