A transaction processing system (TPS) supports the monitoring, collection, storage, and
processing of data from the organization’s basic business transactions, each of which generates
data. When you are checking out at Walmart, for example, a transaction occurs each time the
cashier swipes an item across the bar code reader. Significantly, within an organization, different
functions or departments can define a transaction differently. In accounting, for example,
a transaction is anything that changes a firm’s chart of accounts. The information system definition of a transaction is broader: A transaction is anything that changes the firm’s database.
The chart of accounts is only part of the firm’s database. Consider a scenario in which a student
transfers from one section of an Introduction to MIS course to another section. This
move would be a transaction to the university’s information system, but not to the university’s
accounting department (the tuition would not change).