Coffee Contract

Traditional accounting is process orientated, specifically, it gathers data from ledger accounts, and then extract them and summarizes data in accounts like inventory, supplies, accounts receivables and so on. Because of the summarization process and the limitation of accounts amount, repetition, missing and redundancies would appear easily under this method.

However, REA model gathers and summarizes data via data orientated method, which means that, rarely the data would be recorded in wrong way. In details, as Johnson (1970) suggested, event is a kind of behaviour, a kind of contingent event, in another word, he emphasizes the observation and original features of transactions rather than focusing on conciseness.

Besides, traditional accounting method machines data and save it concentratedly in the accounts, by this method, the process of business event could not be revealed clearly and accurately. On the contrary, REA model classifies the gathered information by events, and it could reflect the original semantic of data as mentioned before. For example, the differences between two kinds of supplies could be recorded in REA model while traditional