in every business organization cash and banking two types of transactions care in help in its smooth operations, cash includes not only coins and paper money but also cheques and bank credit cards are also included under it. hence it payment and receipts are made through cash that is called cash transaction. business firm has to maintain cash book. for the recording of cash transactions and large amount of receipt and payment, firm has to maintain bank account hence when payments and receipts are made on the basis of banking system and using instruments like cheque, drafts etc that is known as banking transaction.
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