Question: ABC sells computer hardware, software, and computer supplies to corporate customers. Corporate customers, used to place their orders for one or more items in advance,

ABC sells computer hardware, software, and computer supplies to corporate customers. Corporate customers, used to place their orders for one or more items in advance, so that the items are waiting to be picked up when they arrive at the store. Corporate customers usually charge their purchases to their account. ABC mails corporate customers monthly statements that summarize all purchases made the prior month. Corporate customers pay the entire balance, as listed on the monthly statement, with a single check.

ABC purchases its inventory from more than a dozen different vendors. Orders are placed via telephone or on the supplier's Web site. Most orders are delivered the next day. Most orders are filled completely in one shipment, but sometimes a supplier is out of stock of a particular item. In such situations, the bulk of the order is shipped immediately and the out-of-stock item is shipped separately as soon as it arrives (such shipments of back orders are never combined with any new orders placed by ABC). ABC usually pays by the 10th of the month for all purchases made the prior month. None of its suppliers allows it to make installment payments. ABC has several new and old employees, and all employees are familiar with the revenue and expenditure process activities.

Part 2 (8%)

a.Draw an REA diagram, complete with maximum and minimum cardinalities, for the revenue cycle described above. (2%)

b.Draw an REA diagram, complete with maximum and minimum cardinalities, for the expenditure cycle described above. (2%)

c.Draw an integrated REA diagram of both the revenue and expenditure cycles for the above information. (2%)

d.Develop a set of relational database tables to implement the integrated REA diagram you developed in question Part 2-c. Present the information in the following format: (2%)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!