As stated earlier, Real Deal Company (RDC) is an electronics wholesale company t

ID: 3198107 • Letter: A

Question

As stated earlier, Real Deal Company (RDC) is an electronics wholesale company that purchases electronic products from manufacturers and resells them to retail stores. Some of its inventory items, such as certain computer products or professional-grade multi-media equipment, require a buyer with a minimum level of knowledge about the product. Common inventory items can be purchased by anyone in the purchasing department. BDC does not include inventory data about products it does not sell.

RDC uses electronic data interchange (EDI) to link directly to several of its larger vendors. With these vendors, BDC’s purchasing system is programmed to place orders (at a predetermined re-order point) that are sent directly to the vendor’s sales order system. With other, smaller vendors, one of RDC’s buyers must call or fax a member of the vendor’s sales staff to order goods. To assure the company continues to get the highest quality products at the best prices, RDC maintains a list of prospective vendors in its vendor file.

Vendors usually process purchase orders within 48 hours. Periodically, RDC places orders for a “hot” new item, only to find it must wait 30 to 90 days before the item is available. Infrequently, RDC receives partial orders from its vendors. This is typically because one of the inventory items requested by RDC is out of stock. However, RDC never receives multiple orders in a single shipment. Inventory shipments are processed by a warehouse clerk.

Real Deal pays it vendors using an open invoice system with the payment terms 2/10, net 30. Clerical employees process all vendor payments, including those for general operating expenses and inventory purchases, as they are due. RDC has a number of bank accounts from which it pays its vendors. Check numbers are unique for each account. Only the company’s payroll account is not available for vendor payments.

RDC maintains an employee master file that contains all employees except its buyers. Data about buyers, including the inventory items for which they are considered experts, are included in a separate file as soon as they sign an employment agreement. Not every buyer has an expertise regarding inventory items, but some buyers are experts on several items. RDC often employs multiple experts so that they don’t have to worry when an experts resigns.

The list of attributes follows. Do not assume there are additional attributes.

Bank_account#

Employee_name

Bank_name

Buyer_emp#

Vendor#

Order_date

Item_Description

Order_quantity

Employee#

Vendor_name

Employee_position

Quantity_shipped

Individual_AP_balance

Check#

Check$

Purchase_order#

Cash_account_balance

Buyer_name

Inventory_QOH

Vendor_invoice#

Item#

Receiving_report#

Instructions:

Please read the description of the expenditure cycle for Real Deals Company and review the list of attributes that are listed for inclusion in the database. Based on the information provided, create an entity-relationship diagram which could be used to develop a relational database.

First, identify the events associated with acquiring inventory. Second, identify the agents and resources involved in each event. Third, determine the cardinalities among all related entities.

Please create the REA Model diagram. Thank you!