Walmart's Accounting Principles
Four Accounting Principles
Sharon Wallace
American Intercontinental University
Accounting Principles
2012
Four Accounting Principles
ABSTRACT
Accounting principles used by Wal-Mart and the core function of its departments. Wal-Mart’s strength and weaknesses will be listed. Wal-Mart’s last two years of accounting statements are also present.
FOUR ACCOUNTING PRINCIPLES There are four key assumptions in the generally accepted accounting principles. The key assumptions in generally accepted accounting principles are business entity, going concern, monetary unit and time period principle. Wal-Mart uses these key assumptions every day. The business entity assumption is just the idea that the business functions as a legal and financial entity separate from its owners or any other business and Wal-Mart does this. This assumption means that all the amounts shown as revenue or expense in the financial statements are for the business alone and do not include personal expenses. Going concern is basically the assumption that the business will operate in the future and we all know Wal-Mart will be operating in the future. This would be used when calculating the values for assets, depreciation for Wal-Mart such as calculating the value of their inventory. The monetary unit assumption is that all the amounts listed use one stable currency, and that any amounts in another currency are clearly listed and not confusing. This would come in handy for Wal-Mart because it is a Global company and accepts all different types of money. Time period assumes that all the transactions reported did in fact occur within the time period in question and not at some other point in time (wise Geek, 2012). There are also four basic principles in the generally accepted accounting principles that Wal-Mart uses. The four basic principles in generally accepted
Sharon Wallace
American Intercontinental University
Accounting Principles
2012
Four Accounting Principles
ABSTRACT
Accounting principles used by Wal-Mart and the core function of its departments. Wal-Mart’s strength and weaknesses will be listed. Wal-Mart’s last two years of accounting statements are also present.
FOUR ACCOUNTING PRINCIPLES There are four key assumptions in the generally accepted accounting principles. The key assumptions in generally accepted accounting principles are business entity, going concern, monetary unit and time period principle. Wal-Mart uses these key assumptions every day. The business entity assumption is just the idea that the business functions as a legal and financial entity separate from its owners or any other business and Wal-Mart does this. This assumption means that all the amounts shown as revenue or expense in the financial statements are for the business alone and do not include personal expenses. Going concern is basically the assumption that the business will operate in the future and we all know Wal-Mart will be operating in the future. This would be used when calculating the values for assets, depreciation for Wal-Mart such as calculating the value of their inventory. The monetary unit assumption is that all the amounts listed use one stable currency, and that any amounts in another currency are clearly listed and not confusing. This would come in handy for Wal-Mart because it is a Global company and accepts all different types of money. Time period assumes that all the transactions reported did in fact occur within the time period in question and not at some other point in time (wise Geek, 2012). There are also four basic principles in the generally accepted accounting principles that Wal-Mart uses. The four basic principles in generally accepted
References: Wal-Mart stores, (2012). http://ethics.walmartstores.com/StatementOfEthics/BasicBeliefs.aspx http://www.walmartstores.com/sites/annualreport/2011/financials.aspx wise Geek, (2012). http://www.wisegeek.com/what-are-the-generally-accepted-accounting-principles.htm