A cash transaction involves the immediate exchange of physical currency for goods or services. Here's a breakdown:
- Initiation: A buyer wants to purchase a product or service from a seller.
- Agreement: The buyer and seller agree on a price for the item or service.
- Payment: The buyer hands over the agreed-upon amount of cash (physical currency) to the seller.
- Exchange: The seller provides the goods or service to the buyer.
- Completion: The transaction is complete once the cash is exchanged and the goods or services are delivered. There is no delayed payment involved, unlike a credit transaction.
Essentially, a cash transaction represents a direct and immediate payment method, contrasting with credit transactions where payment is deferred.
