Home › CMA Foundation › costaccounting › Concept of Transactions › A transaction in accounting must:
A transaction in accounting must:
ABe sanctioned by the board
BAlways involve cash
CBe expressible in monetary terms AND bring change in financial position
DCross a ₹1,000 threshold
Answer & Solution
Correct answer: C. Be expressible in monetary terms AND bring change in financial position
1. Per OCR: "A transaction is an event which can be expressed in monetary terms and brings change in the financial position of a business unit."
2. Mere events (e.g. appointment of a manager) are not transactions.
3. Purchase of goods, capital investment, salary paid — all qualify.
_Source: ICMAI BoS CMA Foundation Paper 2 (FFCA) — Paper2_07042026.pdf, Module 1 §1.3 (page 19)_