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FINDINGS OF FACT
I. Background
A. General Information
Some of the facts have been stipulated and are so found.
The stipulated facts and exhibits submitted therewith are
incorporated herein by this reference. Petitioners comprise an
affiliated group of corporations that use an accrual method of
accounting for financial accounting and tax purposes. They filed
Federal consolidated income tax returns and amended Federal
consolidated income tax returns for the subject years. Their
common parent is Wal-Mart Stores, Inc. (Parent). Parent's
principal place of business was in Bentonville, Arkansas, when it
petitioned the Court.
At all relevant times, Kuhn's-Big K Stores Corp. (Kuhn's)
and Big K Edwards, Inc. (Edwards), were two of Parent's
subsidiaries, and Sam's Wholesale Clubs (Sam's) was one of
Parent's divisions. (We hereinafter use the name "Wal-Mart" to
refer collectively to Parent (without regard to Sam's), Kuhn's,
and Edwards. We hereinafter use the term "petitioners" to refer
collectively to Wal-Mart and Sam's.)
Sam's operated its stores (clubs) on a discount warehouse
basis. Wal-Mart operated its stores as mass discount retailers.
Each Wal-Mart store contained up to 37 departments, and, in the
aggregate, these departments carried a wide range of merchandise,
including home furnishings, electrical appliances, automotive and
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Last modified: May 25, 2011