1. In the REA model everything is defined in terms of____.

A. Resource
B. Events
C. Duality
D. Agents
2. An attribute of an entity can be the field this uniquely identifies each record so that the
record can be retrieved, updated or sorted and it is called

A. Primary key
B. Foreign key
C. Key field
D. Key value
3. Resources in the REA enterprise ontology as defined as

A. Things of economic value provided or consumed by an enterprise´s activities and

operations
B. Individuals, departments, divisions or organizations that participate in the execution
and control of events
C. Activities within an enterprise that need to be planned, controlled, executed and
evaluated.
D. Interconnected business process
4. REA stands for

A. Reality Exchange for Activities

B. Reapplication of Enterprising Accounting
C. Resources, Events, and Agents
D. Resources, Events, and Applications
5. Which of the following is NOT an example of a resource in the REA ontology?

A. Employee labor
B. Land
C. Finished goods
D. Customers
6. Which of the following is not included in the value chain level of the REA model?

A. Financing Process
B. Human resource Process
C. Consumption Process
D. Acquisition Process
7. In the REA ontology agents can be

A. Individuals
B. Departments
C. Organization
D. All of the above
8. The causal relationship between a give event and a receive event is a ___ and ___ defined as
the inflow and outflow of resource.
 A. Difference association; process
B. Duality association; stock flow
C. Stock flow association; duality
D. Value chain association; resource flow
9. Resource flow connections between the internal business processes (transaction cycles) of
an enterprise are most commonly illustrated in:

A. REA Value system model

B. REA Value chain model
C. REA Business process model
D. REA Task model
10. In order from the top down, the hierarchy levels in the REA enterprise ontology are

A. Value system, value chain, business process, task

B. Task, business process, value chain, value system
C. Business process, value chain, task, value system
D. Value chain, task, value system, business process
E.
11. Integrating separate REA diagrams into a single comprehensive enterprise-wide model of the
organization requires understanding what the ________ in each separate diagram reveal
about the organization's business policies and activities.
A. Cardinalities
B. Data
C. Events
D. Transactions

12. When combining two REA diagrams by merging common entities, changes in the cardinality
of the merged entity is needed when it is a(n)
A. Agent
B. Event
C. Relationship
D. Resource
13. Which of the following pairs or classes would typically be associated to each other in a stock
flow association in a REA model?

A. Vendor and inventory

B. Purchase and cash disbursement
C. Purchase and purchasing agent
D. Purchase and inventory
14. Concerning enterprise-wide REA diagrams, which of the following is false?
A. Merging two or more REA diagrams that contain the same resource entity does not
require any changes to the cardinality pairs in the individual diagrams.
B. Merging two or more diagrams that contain a common event entity, however, often
requires changing the minimum cardinalities associated with the other events to 0,
to reflect the fact that the merged event may be connected to any one of several
different events, but not to all of them simultaneously.
C. The minimum cardinalities associated with agents may also have to be changed to 0.
D. All of the above are true.
15. The major benefits of using the REA model as the basis for designing an AIS include all of the
following except
A. the REA data model integrates non-financial and financial data in the AIS.
B. the REA data model makes both non-financial and financial data easily accessible to
management.
C. the REA data model reduces the need for accountants to understand the underlying
accounting journals and ledgers.
D. the REA data model provides the basis for building the kind of flexible AIS that is
responsive to management's changing information needs.

16. Concerning the generation of financial statements from an REA-based relational database,
which of the following is false?
A. It is possible to use a completed REA diagram to guide the writing of queries to
produce the information that would be included in financial statements.
B. It is unnecessary to understand the REA data model to know which tables need to be
included in each query to generate the correct answers to financial statement
questions.
C. Many financial statement items can be displayed by querying a single table.
D. A major advantage of the REA data model is that it integrates non-financial and
financial data.
17. Concerning REA models, which of the following is false?
A. Many financial statement accounts are represented as resources in the REA model.
B. Accounts such as Accounts Receivable show up as entities in the REA model.
C. Some accounts represent an imbalance between two related events in the REA
model.
D. Much of the information about an organization's assets that is traditionally recorded
in ledgers is stored in resource tables in an REA-based relational database.

18. When comparing REA diagrams used to design an AIS with a traditionally designed AIS,
A. similar information is present as in a traditional AIS, but stored in a different format.
B. traditional AIS information, such as journals and ledgers no longer exist.
C. queries are used to input data into the AIS.
D. an REA designed AIS cannot recreate a traditional journal.
19. The process of creating an individual REA diagram involves the following steps except
A. Identify the event entities
B. Identify the resource entities
C. Determine associations and cardinalities between entities
D. Consolidate Individual Models
20. Which of the following is the correct arrangement of event entities according to occurence?

A. Verify availability, take order, receive cash, ship product

B. Verify availability, receive cash, take order, ship product
C. Verify availability, take order, ship product, receive cash
D. Verify availability, ship product, take order, receive cash