Question

For the year ending January 31, 2018, Walmart reported having made sales to its customers (net of returns and allowances) of $495,761,000,000. James Forrest is studying the available information in order to decide whether to buy ownership shares of Walmart on the New York Stock Exchange at the current price. Which of the following statements is true about the figure reported as thsales?

a. Walmart made net sales during these twelve months of exactly $495,761,000,000.
b. The $495,761,000,000 is accurate, although the number has been rounded to the nearest million.
c. Net sales were probably not $495,761,000,000 for the year, but that figure is close enough to be a fair presentation, one that Forrest can rely on in making his decision.
d. If this net sales figure had not been correct, Walmart's accountants would not have allowed the company to report the amount.

Answer 1

The figure reported by Walmart for net sales is close enough to be a fair presentation, one that Forrest can rely on in making his decision to buy ownership shares.

Step-by-step explanation:

The correct answer to the question is option c. Net sales were probably not $495,761,000,000 for the year, but that figure is close enough to be a fair presentation, one that Forrest can rely on in making his decision.

While the figure reported by Walmart may not be exact, it is a reasonable approximation of the net sales made during the year. The number may have been rounded or may not include every single transaction, but it provides a close estimate that can be considered reliable for decision-making purposes.

It's important to note that the reported figure may not account for returns and allowances, which could affect the net sales value. However, for the purpose of evaluating Walmart's performance and making an investment decision, the reported figure can be considered reasonably accurate.