In online processing, how is each transaction handled?

• A. It is entered and processed when it occurs
• B. It is accumulated and processed later
• C. It is processed only at the end of the day
• D. It is stored for archival only

Answer: (A)

Online processing means each transaction is entered and processed immediately as it occurs. This approach keeps data current and provides real-time results, validation, and feedback. That immediacy is why the described handling—entering a transaction and processing it right away—best captures what online processing is about. For example, when you make a purchase with a card, the system checks your balance and records the charge right away, updating your records in real time.

The other descriptions point to batch processing ideas: accumulating transactions and processing them later, or handling them only at the end of the day, or storing data mainly for archival purposes. Those approaches delay processing and do not provide the real-time updates that online processing delivers.