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Leases | 12 Months Ended
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Aug. 29, 2020
Leases [Abstract] |
Leases | 10. LEASES The Company's lease portfolio includes certain real estate (branch offices and customer fulfillment centers), automobiles, and other equipment. The determination of whether an arrangement is, or contains, a lease is performed at the inception of the arrangement. Operating leases are recorded on the balance sheet with operating lease assets representing the right to use the underlying asset for the lease term and lease liabilities representing the obligation to make lease payments arising from the lease. For real estate leases, the Company has elected the practical expedient which allows lease components and non-lease components, such as common area maintenance, to be grouped as a single lease component. The Company has also elected the practical expedient which allows leases with an initial term of twelve months or less to be excluded from the balance sheet. The Company does not guarantee any residual value in its lease agreements, there are no material restrictions or covenants imposed by lease arrangements, and there are no lease transactions with related parties. Real estate leases typically include one or more options to extend the lease. The Company regularly evaluates the renewal options, and when it is reasonably certain of exercise, the Company includes the renewal period in its lease term. The automobile leases contain variable lease payments based on inception and subsequent interest rate fluctuations. For the fiscal year ended August 29, 2020, the variable lease cost was a benefit due to low current interest rates. When readily determinable, the Company uses the interest rate implicit in its leases to discount lease payments. When the implicit rate is not readily determinable, as is the case with substantially all of the real estate leases, the Company utilizes the incremental borrowing rate. The incremental borrowing rate for a lease is the rate of interest the Company would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. The rate for each lease was determined using primarily the Company’s credit spread, the lease term, and currency. The components of lease cost for the year ended August 29, 2020 were as follows:
|  | For the Fiscal Year Ended
|  | August 29, 2020
Operating lease cost |  | $ | 25,445
Variable lease cost (benefit) |  |  | (865)
Short-term lease cost |  |  | 874
Finance lease cost: |  |  |
Amortization of leased assets |  |  | 1,227
Interest on leased liabilities |  |  | 110
Total Lease Cost |  | $ | 26,791
Supplemental balance sheet information relating to operating and finance leases is as follows:
|  | August 29, |  |  | August 31,
| Classification | 2020 |  |  | 2019
Assets |  |
Operating lease assets | Operating lease assets | $ | 56,173 |  | $ | -
Finance lease assets (1) | Property, plant, and equipment, net |  | 3,625 |  |  | 2,958
Total leased assets |  | $ | 59,798 |  | $ | 2,958
Liabilities |  |  |  |  |  |
Current |  |  |  |  |  |
Operating | Current portion of operating lease liabilities | $ | 21,815 |  | $ | -
Finance | Current portion of debt including obligations under finance leases |  | 1,262 |  |  | 765
Noncurrent |  |  |  |  |  |
Operating | Noncurrent operating lease liabilities |  | 34,379 |  |  | -
Finance | Long-term debt including obligations under finance leases |  | 2,453 |  |  | 2,206
Total lease liabilities |  | $ | 59,909 |  | $ | 2,971
(1) Finance lease assets are net of accumulated amortization of $1,439 and $1,398 as of August 29, 2020 and August 31, 2019.
|  | August 29,
|  | 2020
Weighted average remaining lease term (years) |  |  |
Operating Leases |  | 4.0 |
Finance Leases |  | 2.9 |
Weighted average discount rate |  |  |
Operating Leases |  | 3.6 | %
Finance Leases |  | 2.7 | %
The following sets forth supplemental cash flow information related to operating and finance leases:
|  | For the Fiscal Year Ended
|  | August 29, 2020
Operating Cash Outflows from Operating Leases |  | $ | 24,879
Operating Cash Outflows from Finance Leases |  |  | 110
Financing Cash Outflows from Finance Leases |  |  | 1,247
Leased assets obtained in exchange for new lease liabilities: |  |  |
Operating Leases |  | $ | 17,552
Finance Leases |  |  | 1,973
As of August 29, 2020, future lease payments were as follows:
Fiscal Year |  | Operating Leases |  | Finance Leases |  | Total
2021 |  | $ | 23,272 |  | $ | 1,375 |  | $ | 24,647
2022 |  |  | 14,814 |  |  | 1,344 |  |  | 16,158
2023 |  |  | 7,845 |  |  | 1,018 |  |  | 8,863
2024 |  |  | 5,523 |  |  | 152 |  |  | 5,675
2025 |  |  | 3,427 |  |  | 3 |  |  | 3,430
Thereafter |  |  | 6,047 |  |  | - |  |  | 6,047
Total Lease Payments |  |  | 60,928 |  |  | 3,892 |  |  | 64,820
Less: Imputed Interest |  |  | 4,734 |  |  | 177 |  |  | 4,911
Present Value of Lease Liabilities (1) |  | $ | 56,194 |  | $ | 3,715 |  | $ | 59,909
(1) Includes the current p ortion of $21,815 for operating leases and $1,262 for finance leases
As of August 29, 2020, the Company's future lease obligations which have not yet commenced are immaterial. Prior Period Disclosures As a result of the adoption of ASC 842, Leases, on September 1, 2019, the Company is required to present future minimum lease payments for operating and finance lease obligations having initial or remaining non-cancelable lease terms in excess of one year. These future minimum lease payments were previously disclosed in the Company’s 2019 Annual Report on Form 10-K and accounted for under previous lease guidance. Commitments as of August 31, 2019 were as follows:
|  | August 31, 2019
Fiscal Year |  | Operating Leases |  | Capitalized Lease Obligations
2020 |  | $ | 22,463 |  | $ | 792
2021 |  |  | 18,022 |  |  | 812
2022 |  |  | 9,923 |  |  | 781
2023 |  |  | 5,184 |  |  | 604
2024 |  |  | 4,083 |  |  | 106
Thereafter |  |  | 6,023 |  |  | -
Total minimum lease payments |  | $ | 65,698 |  | $ | 3,095
Less: interest |  |  |  |  |  | 124
Present value of minimum lease payments |  |  |  |  | $ | 2,971
Less: current maturities |  |  |  |  |  | 765
Present value of minimum lease payments less current maturities |  |  |  |  | $ | 2,206

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