Replies to Raquel Gillen

Walmart

Walmart leases certain retail locations, distribution and fulfillment centers, warehouses, office spaces, land and equipment throughout the country and globally. Looking at the companys Consolidated Statement of Income, Walmart have both finance and operating leases. A finance lease is a leasing agreement in which the lessee attains ownership of the leased asset by the end of the lease term (Accounting Tools, 2021). An operating lease is an agreement that allows the use of an asset without transferring the rights of ownership (Tardi, 2021). The operating lease cost and finance lease cost of the amortization of right-of-use of assets and the interest on lease obligation could be found in the financial statements (SEC, 2021). For example, Walmarts operating lease cost is $2,670 and $2,626 (in millions) in 2020 and 2021, respectively. The finance lease cost of the amortization of right-of-use of assets is $480 and $583 in 2020 and 2021, respectively. The interest on lease obligations is $306 and $298 in 2020 and 2021, respectively.

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