Exhibit 8-1 Walters Co

question 15

Multiple Choice

Exhibit 8-1 Walters Co.purchased raw materials with a catalog price of $70, 000 on March 2, 2010.Credit terms of 4/20, n/60 applied.If Walters pays for the purchase on March 18, 2010, calculate what amount is recorded for inventory on March 2, 2010, using the method given.
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Refer to Exhibit 8-1.Walters uses a perpetual inventory system and the net price method.

• A)$42, 000
• B)$56, 000
• C)$67, 200
• D)$70, 000

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Definitions:

Financing Activities

Transactions involving long-term liabilities, stockholder's equity, and changes in short-term loans that impact a company's capital structure.

Treasury Stock

Refers to shares that were once part of the outstanding shares and have been bought back by the issuing company.

Interest Payments

Payments made to lenders as compensation for borrowing money, typically calculated as a percentage of the principal amount.

Investing Activities

Transactions involving the purchase and sale of long-term assets and other investments not considered as cash equivalents.