Bingo Mobile sells cellular phones that it manufactures from parts and software that third-party vendors provide. Majority of its sales are made online but some consumers walk-in to retail stores to make their purchases. Consumers have the options to either pay cash or using their credit cards.

When an online order is received, the sales clerk verifies inventory availability, prepares a sales order, and sends the stock release copy to Mariah, a warehouse employee who picks the goods and arranges shipment. She then prepares the bills of lading and shipping notices. Christy in the billing department receives the shipping notices from Mariah and updates the inventory subsidiary ledger to account for the reduction in inventory. Christy files the release, prepares the invoice, and mails a copy of it to the customer. She then updates the sales journal and then sends the invoice, sales order, stock release, and shipping notice to the accounts receivable (AR) department.

Arun in the AR department files the documents that Christy sends him and updates the AR subsidiary ledger. Dina in the mail room receives remittance advices and customer checks sent in payment of accounts. She sends the remittance advise to Arun for posting to the AR ledger and sends the checks to Chen, the receipts clerk. At the end of the day, Chen prepares a deposit slip and deposits the checks into the company’s bank account, files the bank receipt, and updates the cash receipts journal.

Cash sales to consumer customers are handled in a manner similar to the process described here except that checks or credit card account numbers are submitted with the original order.

At the end of the week, Johan, an accounting clerk, reconciles all transactions and posts them to the general ledger.

Required:

1. Prepare the REA model of the sales process and show all the cardinalities for all associations.

2. Explain the differences between economic and support events with TWO (2) examples for each.

Answer rating: 100% (QA)

1 Sales Order Customer Salesperson Inventory Control Clerk Mariah Goods Receipt Clerk Christy Billin... View the full answer