Accounting events in a business refer to the various transactions and occurrences that have a financial impact on the entity.
Thank you for reading this post, don't forget to subscribe!• These events are recorded in the accounting system to capture the changes in the financial position of the business.
• A business transaction is a business activity that can be objectively measured in term of money.
Types of Accounting Events:
Business event may be classified as under:
External Transaction (Events):
External transactions, also known as external events, are those events that involve the exchange of economic resources between the business entity and external parties.
• Examples of external transactions include sales to customers, purchases from suppliers, borrowing money from a bank, or receiving cash from investors.
Internal Transaction (Events):
Internal transactions, or internal events, refer to events that occur within the business entity and do not involve external parties.
• Examples include adjustments for depreciation, the transfer of assets between departments, or internal cost allocations.