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On January 1, Sohan paid rent Rs. 5,000. This can be classified as 
  • a)
    An event 
  • b)
    A transaction. 
  • c)
    A transaction as well as an event. 
  • d)
    Neither a transaction nor an event. 
Correct answer is option 'B'. Can you explain this answer?
Verified Answer
On January 1, Sohan paid rent Rs. 5,000. This can be classified asa)An...
The correct answer is (b) A transaction.

A transaction is an economic event that involves the transfer of money or goods between two parties. In this case, Sohan paid rent of Rs. 5,000. This can be classified as a transaction because:
 
1. Two parties are involved: Sohan (the payer) and the landlord (the receiver).
2. Transfer of value: Sohan is transferring Rs. 5,000 to the landlord in exchange for the use of the rented property.
3. Recordable: This transaction can be recorded in the financial books (e.g., rent expense account for Sohan and rent income account for the landlord).
An event, on the other hand, is a happening or occurrence that may or may not have financial consequences. In this case, the payment of rent is a transaction and not just an event because it involves a transfer of value between parties and can be recorded in financial books.
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Most Upvoted Answer
On January 1, Sohan paid rent Rs. 5,000. This can be classified asa)An...
Explanation:

The given situation involves an exchange of value between two parties, where Sohan pays rent of Rs. 5,000. This exchange of value is known as a transaction. Here, we can identify the following components of a transaction:

- Parties involved: Sohan and the landlord/owner of the property
- Exchange of value: Sohan pays rent of Rs. 5,000 to the landlord/owner
- Time of transaction: January 1

Hence, we can conclude that the given situation is a transaction.

On the other hand, an event is a happening or occurrence that may or may not involve an exchange of value. For example, if Sohan's apartment building catches fire on January 1, that would be an event. However, paying rent is not an event, but a transaction.

Therefore, the correct answer is option B - A transaction.
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Community Answer
On January 1, Sohan paid rent Rs. 5,000. This can be classified asa)An...
a rent can be a office rent then it will be a transaction according to book-keeping OR if a rent is house rent then it is not consider as a transaction
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On January 1, Sohan paid rent Rs. 5,000. This can be classified asa)An eventb)A transaction.c)A transaction as well as an event.d)Neither a transaction nor an event.Correct answer is option 'B'. Can you explain this answer?
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