Income statement example: Walmart's expenses

- [Instructor] Now let's look at Walmart's expenses, the stuff in the income statement in between sales at the top and net income at the bottom. Now, in your mind, go into a Walmart store. Let's say that we go in and buy stuff with a total selling price of $100, do the owners of Walmart, the shareholders get to keep the whole $100? No, they have to pay the business expenses. The first thing they have to do is pay their supplier for the thing that you just bought. That's called cost of sales here. So the cost of sales is the wholesale cost of the stuff that Walmart sells to you and me, in this income statement, the cost of sales is $373 billion. That is the amount that Walmart must pay to its suppliers for the items that you and I purchased from Walmart during the year. Again, think of sales as the retail selling price and cost of sales is the wholesale purchase cost that Walmart had to pay to buy the item. What else does…