## Transactions

### Learning Outcomes

• Define transactions

## Transactions Defined

A transaction for financial accounting purposes is an economic event that has a monetary impact on the financial statements.  Each monetary transaction is recorded in a journal, and the journal entries are then sorted by account and posted to a ledger.  The ledger balances are transferred to the financial statements. Recall the monetary unit assumption that states that the amounts on the financial statements are monetary amounts, so in the United States, the amount of the transaction would be in U.S. dollars.

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