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Summary of Significant Accounting Policies (Policies)
 6 Months Ended
Apr. 14, 2023
Accounting Policies [Abstract]  
Comprehensive income or loss

Comprehensive income or loss

 

Comprehensive income or loss consists of net income and additional minimum pension liability adjustments. There were no differences between net income and comprehensive income during each of the twelve and twenty-four weeks ended April 14, 2023, or April 15, 2022.

 

 
Customer Concentration > 20% of AR or >10% of Sales

Customer Concentration > 20% of AR or >10% of Sales

 

The table below shows customers that accounted for more than 20% of consolidated accounts receivable (“AR”) or 10% of consolidated sales for the twenty-four weeks ended April 14, 2023, and April 15, 2022, respectively.

 

Schedule of Customer Concentration

   Walmart (1)   Dollar General 
   Sales   AR   Sales   AR 
April 14, 2023   30.4%   27.3%   16.2%   27.1%
April 15, 2022   31.4%   4.4%   17.7%   38.1%

 

(1)

Walmart AR represented a higher percentage of consolidated AR as of April 14, 2023, due to terminating the accelerated payments on outstanding accounts receivable on July 1, 2022.

 

The table below shows customers that accounted for more than 20% of consolidated accounts receivable or 10% of consolidated sales for the twelve weeks ended April 14, 2023, and April 15, 2022, respectively.

 

   Walmart (1)   Dollar General 
   Sales   AR   Sales   AR 
April 14, 2023   30.8%   27.3%   20.1%   27.1%
April 15, 2022   30.5%   4.4%   19.6%   38.1%

 

(1) Walmart AR represented a higher percentage of consolidated AR as of April 14, 2023, due to terminating the accelerated payments on outstanding accounts receivable on July 1, 2022.

 
Revenue recognition

Revenue recognition

 

Revenues are recognized in accordance with Accounting Standards Codification (“ASC”) Topic 606 – Revenue from Contracts with Customers upon passage of title to the customer, typically upon product pick-up, shipment, or delivery to customers. Products are delivered to customers primarily through our own long-haul fleet, common carrier, or through a Company-owned direct store delivery system.

 

The Company recognizes revenue for the sale of the product at the point in time when our performance obligation has been satisfied and control of the product has transferred to our customer, which generally occurs upon shipment, pickup or delivery to a customer based on terms of the sale. Contracts with customers are typically short-term in nature with completion of a single performance obligation. Product is sold to foodservice, retail, institutional and other distribution channels. Shipping and handling that occurs after the customer has obtained control of the product is recorded as a fulfillment cost rather than an additional performance obligation. Costs paid to third party brokers to obtain contracts are recognized as part of selling expenses. Other sundry items in context of the contract are also recognized as selling expense. Any taxes collected on behalf of the government are excluded from net revenue.

 

We record revenue at the transaction price which is measured as the amount of consideration we anticipate receiving in exchange for providing products to our customers. Revenue is recognized as the net amount estimated to be received after deducting estimated or known amounts including variable consideration for discounts, trade allowances, consumer incentives, coupons, volume-based incentives, cooperative advertising, product returns and other such programs. Promotional allowances, including customer incentive and trade promotion activities, are recorded as a reduction to sales based on amounts estimated being due to customers, based primarily on historical utilization and redemption rates. Estimates are reviewed regularly until incentives or product returns are realized and the result of any such adjustments are known. Promotional allowances deducted from sales for the twelve weeks ended April 14, 2023 and April 15, 2022, were $4,520 and $3,862, respectively. Promotional allowances deducted from sales for the twenty-four weeks ended April 14, 2023, and April 15, 2022, were $8,384 and $7,366, respectively.

 
Leases

Leases

 

Leases are recognized in accordance with ASC 842 Leases (“ASC 842”) which requires a lessee to recognize assets and liabilities with lease terms of more than twelve months. We lease or rent property for such operations as storing inventory and equipment. We analyze our agreements to evaluate whether or not a lease exists by determining what assets exist for which we control usage for a period of time in exchange for consideration. In the event a lease exists, we classify it as a finance or operating lease and record a right-of-use (“ROU”) asset and the corresponding lease liability at the inception of the lease. In the case of month-to-month lease or rental agreements with terms of twelve months or less, we made an accounting policy election to not recognize lease assets and liabilities and record them on a straight-line basis over the lease term. The storage units rented on a month-to-month basis for use by our Snack Food Product segment direct store delivery route system are not costly to relocate and contain no significant leasehold improvements or degree of integration over leased assets. Orders can be fulfilled by another route storage unit interchangeably. No specialized assets exist in the rental storage units. Market price is paid for storage units. No guarantee of debt is made.

 

 

ROU lease assets are recorded within property, plant and equipment, net of accumulated depreciation and amortization. The Company leases warehouse space from time to time that is recorded as ROU lease assets and corresponding lease liabilities. The Company’s leases of long-haul trucks used in its Frozen Food Products segment qualify as finance leases. Finance lease liabilities are recorded under other liabilities, the consolidated balance sheets reflecting both the current and long-term obligation. The classification as a finance or operating lease determines whether the recognition, measurement and presentation of expenses and cash flows are considered operating or financing.

 
Subsequent events

Subsequent events

 

Management has evaluated events subsequent to April 14, 2023, through the date that the accompanying Condensed Consolidated Financial Statements were filed with the Securities and Exchange Commission for transactions and other events which may require adjustments of and/or disclosure in such financial statements.

 

On April 17, 2023, the Company leased one box truck for a market value of $27 and that lease term is two years.

 

Based on Management’s review, no other material events were identified that require adjustment to the financial statements or additional disclosure.

 
Basic earnings per share

Basic earnings per share

 

Basic earnings per share are calculated based on the weighted average number of shares outstanding for all periods presented. No stock options, warrants, or other potentially dilutive convertible securities were outstanding as of April 14, 2023, or April 15, 2022.