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## (p) income taxes 

the Company’s income taxes are accounted for under the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. Deferred tax expense (benefit) results from the net change during the year in deferred tax assets and liabilities. the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. 

the Company evaluates the need for a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. the Company has considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for a valuation allowance. should the Company determine that it would not be able to realize all or part of its deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to income in the period such determination was made. 

the Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. the tax benefits recognized in the consolidated financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. the Company recognizes interest and penalties accrued related to unrecognized tax benefits in tax expense. 

## (q) Segments and related information 

the Company follows the provisions of AsC 280, segment Reporting, which establish standards for the way public business enterprises report information and operating segments in annual financial statements (see note 19). 

## Revisions 

Certain revisions have been made to the 2013 Consolidated Balance sheet to conform to the current year presentation relating to the current and long-term classification of deferred taxes. the impact on the 2013 Consolidated Balance sheet was a decrease in the amount of $112,000 to both current deferred income taxes (asset) and long-term deferred income taxes (liability). In addition, certain revisions have been made to the 2013 and 2012 Consolidated statements of Operations to conform to the current year presentation relating to classification of certain rent and indirect labor items. the impact on the Consolidated statements of Operations was a decrease to costs of sales and an increase to selling, general and administrative expenses in the amounts of $365,000 and $134,000 for the years 2013 and 2012, respectively. these revisions had no impact on previously reported net income or cash flows and are deemed immaterial to the previously issued financial statements. 

## Recent Accounting Pronouncements 

On May 28, 2014, the Financial Accounting standards Board (FAsB) issued Accounting standards Update (AsU) no. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. this standard will replace most existing revenue recognition guidance when it becomes effective January 1, 2017. early application is not permitted. the standard permits the use of either the retrospective or cumulative effect transition methods. the Company is evaluating the effect that AsU 2014-09 will have on our consolidated financial statements and related disclosures. We have not yet selected a transition method nor have we determined the effect of the standard on our consolidated financial position and results of operations. 

there were no new accounting pronouncements adopted during 2014 that had a material effect on our consolidated financial statements. 

## (2) Supplemental cash Flow information 

Cash paid for interest and income taxes is as follows (in thousands): 

<img src='content_image/274291.jpg'>

During the years ended December 31, 2014 and 2013, the Company permitted the exercise of stock options with exercise proceeds paid with the Company’s stock (“cashless” exercises) totaling approximately $372,000 and $225,000, respectively. 

the purchase of substantially all of the assets of packaging Alternatives Corporation in 2012 included consideration in the form of a holdback of $600,000 and a long-term note valued at $692,000. 

