Einstein Corporation Reported a Decrease in Inventory of $12,000

question 20

Multiple Choice

Einstein Corporation reported a decrease in inventory of $12,000. The cost of goods sold for the year was $150,000. There was also a $4000 decrease in accounts payable from the beginning of the year to the end of the year. What is Einstein's cash payment to suppliers for inventory?

• A)$134,000
• B)$142,000
• C)$158,000
• D)$166,000

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Definitions:

Assets

Economic resources owned by a business or individual that are expected to bring future benefits or value.

Cost Method

An accounting method used to value inventory or investments, based on the historical cost paid for the asset.

Voting Stock

Voting stock refers to shares that give the shareholder the right to vote on company matters, such as electing the board of directors.

Debt Securities

Financial instruments representing a loan made by an investor to a borrower, typically including bonds, notes, and bills.