Inventories: Inventories are stated at the lower of cost or market. Cost is determined using the first-in, first-out method. 

Goodwill and Other Intangible Assets: Goodwill is the excess of the purchase price paid over the fair value of the net assets of the business acquired. As discussed in Note B, the Company adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets (SFAS 142), effective May 1, 2002. In accordance with SFAS 142, goodwill and indefinite-lived intangible assets are no longer amortized but are reviewed at least annually for impair- ment. The Company conducts its annual test of impairment for goodwill and indefinite-lived intangible assets in the fourth quarter. In addition, the Company will test again for impairment if events or circumstances occur subsequent to the Company’s annual impairment tests that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Other finite-lived intangible assets will continue to be amortized over their useful lives. Prior to fiscal 2003, goodwill and other intangible assets, principally trademarks and patents, were amortized using the straight-line method over periods ranging from 5 to 40 years for acquisitions prior to July 1, 2001. 

Property, Plant, and Equipment: Property, plant, and equipment are recorded at cost and are depreciated on a straight- line basis over the estimated useful lives of the assets (3 to 15 years for machinery and equipment, and 10 to 40 years for buildings, fixtures, and improvements). 

The Company leases certain land, buildings, and equipment for varying periods of time, with renewal options. Leases of cold storage facilities are continually renewed. Total rental expense in fiscal 2003, 2002, and 2001 totaled $17,324,000, $10,430,000, and $11,827,000, respectively. Rental expense for cold storage facilities, which is based on quantities stored, amounted to $2,801,000, $2,324,000, and $3,319,000 in fiscal 2003, 2002, and 2001, respectively. 

Impairment of Long-Lived Assets: Effective May 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (SFAS 144). SFAS 144 supersedes Statement of Financial Accounting Standards No. 121, Accounting for the Impairment of Long-Lived Assets and for Long- Lived Assets to Be Disposed Of, to supply a single accounting approach for measuring impairment of long-lived assets, including finite-lived intangible assets, businesses accounted for as a discontinued operation, assets to be sold, and assets to be disposed of other than by sale. The initial adoption of SFAS 144 did not have a significant impact on the Company’s results of operations or financial position. 

Under SFAS 144, long-lived assets, except goodwill and indefinite-lived intangible assets, are reviewed for impairment when circumstances indicate the carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to future net cash flows estimated by the Company to be generated by such assets. If such assets are considered to be impaired, the impairment to be recognized is the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are recorded at the lower of carrying value or estimated net realizable value. 

Software Costs: The Company capitalizes significant costs associated with the development and installation of inter- nal use software. Amounts capitalized are amortized over the estimated useful lives of the software, ranging from three to seven years, beginning with the project’s completion. Net capitalized software costs as of April 30, 2003 and 2002, were $27,504,000 and $28,173,000, respectively, of which $4,400,000 and $3,484,000 were included in construction in progress. 

Shipping and Handling Costs: Shipping and handling costs are included in cost of products sold. 

Advertising Expense: Advertising costs are expensed as incurred. Advertising expense was $45,783,000, $15,525,000, and $14,178,000 in fiscal 2003, 2002, and 2001, respectively. 

Stock Compensation: As provided under Statement of Financial Accounting Standards No. 123, Accounting for Stock- Based Compensation (SFAS 123), the Company has elected to follow Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (APB 25), and related interpretations in accounting for its employee stock options. Under APB 25, because the exercise price of the Company’s employee stock options equals the market price of the underlying stock on the date of grant, no compensation expense is recognized. 

