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10 CHAPTER 1 BUSINESS PROCESSES, DATA MODELING, AND INFORMATION SYSTEMS

Resource Event Agent

Jesse

Inventory Sales

Customer

Customer
Cash
(Bank Cash Receipt
Account)

Jesse

FIGURE 1-11 Basic REA Diagram for Cherokee's Revenue Cycle

The next step is to determine the cardinalities of each relationship. First,
notice in Figure 1-12 that "Bank Account" is added to the resource "Cash," because this
describes where the inflow of cash is recorded. According to the description of
Cherokee's cash collection processes, the relationship between "Bank Account" and
"Cash Receipt" should be (1,N) and (1,1). That is, a bank account will have at least one
cash receipt deposit but can have many deposits. Each cash receipt is deposited into
one, and only one, bank account.
Figure 1-13 indicates that the relationship between "Inventory" and "Sales" is (0,1)
and (1,N). Each art piece or antique may not be sold yet; if it is sold, it can be sold once only,
since all are originals. Hence, the minimum cardinality is zero and maximum cardinality is
one for the "Inventory" entity. For each sale transaction, at least one piece of inventory and,

(1, 1)
Cash
(Bank Cash
Receipt
Account)
FIGURE 1-12 Cash-Cash Reciept Relationship

(0, 1) (1, N)
Inventory Sales

FIGURE 1-13 Inventory-Sales Relationship