Cash transaction

This usually refers to transactions using physical cash rather than those flowing through bank accounts.

Cash transactions are common for retail purchases and for transactions between individuals rather than business to business. Businesses making and accepting cash transactions are still required to account for them in the same way as bank transactions, including applying any relevant taxation. The holding and transfer of large amounts of cash can have additional costs for businesses and can increase their risks. Also note, in the case of takeovers and mergers the phrase cash transaction can be used where no equity is issued to make the purchase – in this case the purchase is not literally made in cash, it will be by bank transfer.

Cash transaction is a term normally found in financial management, accounting and reporting;

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