Transaction definition including break down of areas in the definition. Analyzing the definition of key term often provides more insight about concepts. The term Transaction can be defined as: Exchange of economic consideration affecting an entity’s financial position that can be reliably measured. Transaction are the economic events that the accounting process records through the use of a double entry accounting system, through the use of debits and credits, common transactions being the sale of inventory, sale of service, or bill for utilities. Data about transactions is what makes up most of accounting information, this transaction data being compiled into relevant forms, often in the form of financial statements.
