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LEASES | 6 Months Ended
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Nov. 24, 2019
Leases [Abstract] |
LEASES | 12. LEASES We have operating and finance leases of certain warehouses, plants, land, office space, production and distribution equipment, automobiles, and office equipment. We determine whether an agreement is or contains a lease at lease inception. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. As most of our leases do not provide an implicit interest rate, we calculate the lease liability at lease commencement as the present value of unpaid lease payments using our estimated incremental borrowing rate. The incremental borrowing rate represents the rate of interest that we would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term and is determined using a portfolio approach based on information available at the commencement date of the lease. We have elected not to separate lease and non-lease components of an agreement for all underlying asset classes prospectively from the ASC 842 adoption date. Any lease arrangements with an initial term of 12 months or less are not recorded on our Condensed Consolidated Balance Sheet. We recognize lease cost for these lease arrangements on a straight-line basis over the lease term. Our lease terms may include options to extend or terminate the lease. We consider these options in determining the lease term used to establish our ROU asset and lease liabilities. A limited number of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Leases reported in our Condensed Consolidated Balance Sheet as of November 24, 2019 were as follows:
|  | Operating Leases |
|  | Balance Sheet Location |  | November 24, 2019 |
ROU assets, net |  | Other assets |  | $ | 235.0 |
Lease liabilities (current) |  | Other accrued liabilities |  |  | 46.9 |
Lease liabilities (noncurrent) |  | Other noncurrent liabilities |  |  | 228.5 |
|  | Finance Leases |
|  | Balance Sheet Location |  | November 24, 2019 |
ROU assets, at cost |  | Property, plant and equipment |  | $ | 212.9 |
Less accumulated depreciation |  | Less accumulated depreciation |  |  | (47.8 | )
ROU assets, net |  | Property, plant and equipment, net |  |  | 165.1 |
Lease liabilities (current) |  | Current installments of long-term debt |  |  | 20.3 |
Lease liabilities (noncurrent) |  | Senior long-term debt, excluding current installments |  |  | 135.6 |
The components of total lease cost for the second quarter and first half of fiscal 2020 were as follows:
Lease cost |  | Thirteen weeks ended November 24, 2019 |  |  | Twenty-six weeks ended November 24, 2019 |
Operating lease cost |  | $ | 18.8 |  |  | $ | 36.8 |
Finance lease cost |  |  |  |  |  |  |  |
Depreciation of leased assets |  |  | 3.9 |  |  |  | 7.7 |
Interest on lease liabilities |  |  | 2.2 |  |  |  | 4.5 |
Short-term lease costs |  |  | 0.7 |  |  |  | 1.4 |
Total lease cost |  | $ | 25.6 |  |  | $ | 50.4 |
We recognized accelerated operating lease cost of $8.7 million and impairments of ROU assets of $2.9 million within SG&A expenses in the first half of fiscal 2020. These charges are included in the Pinnacle Integration Restructuring Plan. The weighted-average remaining lease terms and weighted-average discount rate for our leases as of November 24, 2019 were as follows:
|  | Operating Leases |  |  | Finance Leases |
Weighted-average remaining lease term (in years) |  |  | 8.5 |  |  |  | 8.4 |
Weighted-average discount rate |  |  | 3.60 | % |  |  | 5.42 | %
Cash flows arising from lease transactions for the first half of fiscal 2020 were as follows:
|  | Twenty-Six Weeks Ended November 24, 2019 |
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
Operating cash outflows from operating leases |  | $ | 27.8 |
Operating cash outflows from finance leases |  |  | 4.8 |
Financing cash outflows from finance leases |  |  | 10.9 |
ROU assets obtained in exchange for new lease liabilities: |  |  |  |
Operating leases |  |  | 38.4 |
Finance leases |  |  | 1.4 |
Maturities of lease liabilities by fiscal year as of November 24, 2019 were as follows:
|  | Operating Leases |  |  | Finance Leases |  |  | Total |
2020 (remaining year) |  | $ | 27.9 |  |  | $ | 13.8 |  |  | $ | 41.7 |
2021 |  |  | 54.8 |  |  |  | 28.5 |  |  |  | 83.3 |
2022 |  |  | 41.6 |  |  |  | 27.0 |  |  |  | 68.6 |
2023 |  |  | 35.1 |  |  |  | 21.9 |  |  |  | 57.0 |
2024 |  |  | 27.5 |  |  |  | 17.7 |  |  |  | 45.2 |
Later years |  |  | 137.4 |  |  |  | 90.1 |  |  |  | 227.5 |
Total lease payments |  |  | 324.3 |  |  |  | 199.0 |  |  |  | 523.3 |
Less: Imputed interest |  |  | (48.9 | ) |  |  | (43.1 | ) |  |  | (92.0 | )
Total lease liabilities |  | $ | 275.4 |  |  | $ | 155.9 |  |  | $ | 431.3 |
We have entered into lease agreements for certain facilities and equipment with payments totaling $10.8 million that have not yet commenced as of November 24, 2019. A summary of non-cancelable operating lease commitments as of May 26, 2019 is as follows:
2020 |  | $ | 52.1 |
2021 |  |  | 48.4 |
2022 |  |  | 38.0 |
2023 |  |  | 34.1 |
2024 |  |  | 25.6 |
Later years |  |  | 114.4 |
|  | $ | 312.6 |
Rent expense under all operating leases was $83.5 million in fiscal 2019. This amount is inclusive of certain charges recognized at the cease use date for remaining lease payments associated with exited properties.

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