How do the entity relationship (ER) and the REA diagrams differ?

Answer 1

ER and REA diagrams differ visually in a significant way. Entities in ER diagrams are of one class and their proximity to other entities is determined by their cardinality and by what is visually pleasing to keep the diagrams readable. Entities on REA diagram, however, are divided into three classes (Resources, Events, and Agents) and organized into constellations by class on the diagram. A second difference between ER and REA diagrams involves the sequencing of events. ER diagrams present a static picture of the underlying business phenomena. REA diagrams, however, are typically organized from top to bottom within the constellations to focus on the sequence of events. The third difference between ER and REA diagrams pertains to naming conventions for entities. In ER diagrams, entity names are always represented in the singular noun form. REA modeling applies this rule when assigning names to resource and agent entities. Event entities, however, are given verb (action) names such as Sell Inventory, Take Order, or Receive Cash.