Basically "Dump Tran" is a Command used in SQL Server 6.5 which is equivalent to "Backup Tran" in SQL Server 7.0 and 2000.

Dump Tran/Backup Tran with "NO_LOG" will clear the log file which must be used only at critical times if you dont worry about losing data.

Dump Tran/Backup Tran will not reduce the size of the log file, unless you have enabled "Auto Shrink" for the database. I can say in 2 steps the same thing, 1. Clear transactions in log files and then 2. Shrink the log file.Thats the concept involved on this.

Varad01