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Leases | 9 Months Ended
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Oct. 03, 2021
Leases [Abstract] |
Leases | Leases The Company routinely enters into leasing arrangements for real estate (including manufacturing facilities, office space, and warehouses), transportation equipment (automobiles, forklifts, and trailers), and office equipment (copiers and postage machines). The assessment of the certainty associated with the exercise of various lease renewal, termination, and purchase options included in the Company's lease contracts is at the Company's sole discretion. Most real estate leases, in particular, include one or more options to renew, with renewal terms that can extend the lease term from one to 50 years. The Company's leases do not have any significant residual value guarantees or restrictive covenants. As the implicit rate in the Company's leases is not readily determinable, the Company calculates its lease liabilities using discount rates based upon the Company’s incremental secured borrowing rate, which contemplates and reflects a particular geographical region’s interest rate for the leases active within that region of the Company’s global operations. The Company further utilizes a portfolio approach by assigning a “short” rate to contracts with lease terms of 10 years or less and a “long” rate for contracts greater than 10 years. The following table sets forth the balance sheet location and values of the Company’s lease assets and lease liabilities at October 3, 2021 and December 31, 2020:
Classification |  | Balance Sheet Location |  | October 3, 2021 | December 31, 2020
Lease Assets |  |  |  |  |
Operating lease assets |  | Right of Use Asset - Operating Leases |  | $ | 269,855 |  | $ | 296,020 |
Finance lease assets |  | Other Assets |  | 47,154 |  | 36,267 |
Total lease assets |  |  |  | $ | 317,009 |  | $ | 332,287 |
Lease Liabilities |  |  |  |  |
Current operating lease liabilities |  | Accrued expenses and other |  | $ | 44,588 |  | $ | 52,138 |
Current finance lease liabilities |  | Notes payable and current portion of debt |  | 6,236 |  | 4,663 |
Total current lease liabilities |  |  |  | $ | 50,824 |  | $ | 56,801 |
Noncurrent operating lease liabilities |  | Noncurrent Operating Lease Liabilities |  | $ | 236,590 |  | $ | 262,048 |
Noncurrent finance lease liabilities |  | Long-term Debt, Net of Current Portion |  | 45,101 |  | 33,280 |
Total noncurrent lease liabilities |  |  |  | $ | 281,691 |  | $ | 295,328 |
Total lease liabilities |  |  |  | $ | 332,515 |  | $ | 352,129 |
Certain of the Company’s leases include variable costs. Variable costs include lease payments that were volume or usage-driven in accordance with the use of the underlying asset, and also non-lease components that were incurred based upon actual terms rather than contractually fixed amounts. In addition, variable costs are incurred for lease payments that are indexed to a change in rate or index. Because the right of use assets recorded on the balance sheet were determined based upon factors considered at the commencement date of the leases, subsequent changes in the rate or index that were not contemplated in the right of use asset balances recorded on the balance sheet result in variable expenses being incurred when paid during the lease term. The following table sets forth the components of the Company's total lease cost for the three- and nine- month periods ended October 3, 2021 and September 27, 2020:
|  | Three Months Ended | Nine Months Ended
Lease Cost |  | October 3, 2021 | September 27, 2020 | October 3, 2021 | September 27, 2020
Operating lease cost | (a) | $ | 11,623 |  | $ | 18,192 |  | $ | 36,720 |  | $ | 46,903 |
Finance lease cost: |  |  |  |  |
Amortization of lease asset | (a) | 1,476 |  | 1,061 |  | 4,133 |  | 5,999 |
Interest on lease liabilities | (b) | 367 |  | 258 |  | 997 |  | 721 |
Variable lease cost | (a) (c) | 6,796 |  | 7,455 |  | 19,569 |  | 29,316 |
Total lease cost |  | $ | 20,262 |  | $ | 26,966 |  | $ | 61,419 |  | $ | 82,939 |
(a) Production-related and administrative amounts are included in cost of sales and selling, general and administrative expenses, respectively. (b) Included in interest expense. (c) Also includes short term lease costs, which are deemed immaterial. The following table sets forth certain lease-related information for the nine months ended October 3, 2021 and September 27, 2020:
|  | Nine Months Ended
|  | October 3, 2021 | September 27, 2020
Cash paid for amounts included in the measurement of lease liabilities: |  |
Operating cash flows used by operating leases | $ | 38,757 |  | $ | 43,858 |
Operating cash flows used by finance leases | $ | 997 |  | $ | 721 |
Financing cash flows used by finance leases | $ | 3,375 |  | $ | 6,440 |
Noncash investing and financing activities: |  |  |
Leased assets obtained in exchange for new operating lease liabilities | $ | 12,230 |  | $ | 84,578 |
Leased assets obtained in exchange for new finance lease liabilities | $ | 7,071 |  | $ | 19,122 |
Modification to leased assets for increase/(decrease) in operating lease liabilities | $ | 12,059 |  | $ | (3,977) |
Modification to leased assets for increase in finance lease liabilities | $ | 9,586 |  | $ | 19,194 |
Termination reclasses to decrease operating lease assets | $ | (4,971) |  | $ | (4,232) |
Termination reclasses to decrease operating lease liabilities | $ | (5,278) |  | $ | (4,611) |
Termination reclasses to decrease finance lease assets | $ | (33) |  | $ | (19,994) |
Termination reclasses to decrease finance lease liabilities | $ | (40) |  | $ | (20,121) |
Leases | Leases The Company routinely enters into leasing arrangements for real estate (including manufacturing facilities, office space, and warehouses), transportation equipment (automobiles, forklifts, and trailers), and office equipment (copiers and postage machines). The assessment of the certainty associated with the exercise of various lease renewal, termination, and purchase options included in the Company's lease contracts is at the Company's sole discretion. Most real estate leases, in particular, include one or more options to renew, with renewal terms that can extend the lease term from one to 50 years. The Company's leases do not have any significant residual value guarantees or restrictive covenants. As the implicit rate in the Company's leases is not readily determinable, the Company calculates its lease liabilities using discount rates based upon the Company’s incremental secured borrowing rate, which contemplates and reflects a particular geographical region’s interest rate for the leases active within that region of the Company’s global operations. The Company further utilizes a portfolio approach by assigning a “short” rate to contracts with lease terms of 10 years or less and a “long” rate for contracts greater than 10 years. The following table sets forth the balance sheet location and values of the Company’s lease assets and lease liabilities at October 3, 2021 and December 31, 2020:
Classification |  | Balance Sheet Location |  | October 3, 2021 | December 31, 2020
Lease Assets |  |  |  |  |
Operating lease assets |  | Right of Use Asset - Operating Leases |  | $ | 269,855 |  | $ | 296,020 |
Finance lease assets |  | Other Assets |  | 47,154 |  | 36,267 |
Total lease assets |  |  |  | $ | 317,009 |  | $ | 332,287 |
Lease Liabilities |  |  |  |  |
Current operating lease liabilities |  | Accrued expenses and other |  | $ | 44,588 |  | $ | 52,138 |
Current finance lease liabilities |  | Notes payable and current portion of debt |  | 6,236 |  | 4,663 |
Total current lease liabilities |  |  |  | $ | 50,824 |  | $ | 56,801 |
Noncurrent operating lease liabilities |  | Noncurrent Operating Lease Liabilities |  | $ | 236,590 |  | $ | 262,048 |
Noncurrent finance lease liabilities |  | Long-term Debt, Net of Current Portion |  | 45,101 |  | 33,280 |
Total noncurrent lease liabilities |  |  |  | $ | 281,691 |  | $ | 295,328 |
Total lease liabilities |  |  |  | $ | 332,515 |  | $ | 352,129 |
Certain of the Company’s leases include variable costs. Variable costs include lease payments that were volume or usage-driven in accordance with the use of the underlying asset, and also non-lease components that were incurred based upon actual terms rather than contractually fixed amounts. In addition, variable costs are incurred for lease payments that are indexed to a change in rate or index. Because the right of use assets recorded on the balance sheet were determined based upon factors considered at the commencement date of the leases, subsequent changes in the rate or index that were not contemplated in the right of use asset balances recorded on the balance sheet result in variable expenses being incurred when paid during the lease term. The following table sets forth the components of the Company's total lease cost for the three- and nine- month periods ended October 3, 2021 and September 27, 2020:
|  | Three Months Ended | Nine Months Ended
Lease Cost |  | October 3, 2021 | September 27, 2020 | October 3, 2021 | September 27, 2020
Operating lease cost | (a) | $ | 11,623 |  | $ | 18,192 |  | $ | 36,720 |  | $ | 46,903 |
Finance lease cost: |  |  |  |  |
Amortization of lease asset | (a) | 1,476 |  | 1,061 |  | 4,133 |  | 5,999 |
Interest on lease liabilities | (b) | 367 |  | 258 |  | 997 |  | 721 |
Variable lease cost | (a) (c) | 6,796 |  | 7,455 |  | 19,569 |  | 29,316 |
Total lease cost |  | $ | 20,262 |  | $ | 26,966 |  | $ | 61,419 |  | $ | 82,939 |
(a) Production-related and administrative amounts are included in cost of sales and selling, general and administrative expenses, respectively. (b) Included in interest expense. (c) Also includes short term lease costs, which are deemed immaterial. The following table sets forth certain lease-related information for the nine months ended October 3, 2021 and September 27, 2020:
|  | Nine Months Ended
|  | October 3, 2021 | September 27, 2020
Cash paid for amounts included in the measurement of lease liabilities: |  |
Operating cash flows used by operating leases | $ | 38,757 |  | $ | 43,858 |
Operating cash flows used by finance leases | $ | 997 |  | $ | 721 |
Financing cash flows used by finance leases | $ | 3,375 |  | $ | 6,440 |
Noncash investing and financing activities: |  |  |
Leased assets obtained in exchange for new operating lease liabilities | $ | 12,230 |  | $ | 84,578 |
Leased assets obtained in exchange for new finance lease liabilities | $ | 7,071 |  | $ | 19,122 |
Modification to leased assets for increase/(decrease) in operating lease liabilities | $ | 12,059 |  | $ | (3,977) |
Modification to leased assets for increase in finance lease liabilities | $ | 9,586 |  | $ | 19,194 |
Termination reclasses to decrease operating lease assets | $ | (4,971) |  | $ | (4,232) |
Termination reclasses to decrease operating lease liabilities | $ | (5,278) |  | $ | (4,611) |
Termination reclasses to decrease finance lease assets | $ | (33) |  | $ | (19,994) |
Termination reclasses to decrease finance lease liabilities | $ | (40) |  | $ | (20,121) |

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- Definition The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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