Revenue Recognition: The Company recognizes sales when title passes upon delivery of its products to customers, net of applicable provisions for discounts, returns, and allowances. Products are delivered upon receipt of customer purchase orders with acceptable terms, including price and collectabil- ity that is reasonably assured. 

The Company offers various sales incentives to customers and consumers. Incentives that are offered off-invoice include prompt pay allowances, will call allowances, spoilage allow- ances, and temporary price reductions. These incentives are recognized as reductions of revenue at the time title passes. Coupons are used as an incentive for consumers to purchase various products. The coupons reduce revenues at the time they are offered, based on estimated redemption rates. Promotional contracts are performed by customers to pro- mote the Company’s products to consumers. These incentives reduce revenues at the time of performance through direct payments and accrued promotional funds. Accrued promo- tional funds are unpaid liabilities for promotional contracts in process or completed at the end of a quarter or fiscal year. Promotional contract accruals are based on a review of the unpaid outstanding contracts on which performance has taken place. Estimates used to determine the revenue reduction include the level of customer performance and the historical spend rate versus contracted rates. 

Allowance for Doubtful Accounts: The Company estimates the allowance for doubtful accounts based on a combination of factors, including the age of its accounts receivable balances, customer history, collection experience, and current market factors. Additionally, a specific reserve may be established if the Company becomes aware of a customer’s inability to meet its financial obligations. 

Advertising Expenses: Advertising costs are expensed when incurred. Advertising expenses include all media advertising but exclude the costs associated with samples, demonstra- tions, and market research. Advertising costs for fiscal years 2014, 2013, and 2012 were $114.4 million, $89.9 million, and $103.4 million, respectively. 

Shipping and Handling Costs: The Company’s shipping and handling expenses are included in cost of products sold. 

Research and Development Expenses: Research and devel- opment costs are expensed as incurred and are included in selling, general and administrative expenses. Research and development expenses incurred for fiscal years 2014, 2013, and 2012 were $29.9 million, $29.9 million, and $29.8 million, respectively. 

Income Taxes: The Company records income taxes in accor- dance with the liability method of accounting. Deferred taxes are recognized for the estimated taxes ultimately payable or recoverable based on enacted tax law. Changes in enacted tax rates are reflected in the tax provision as they occur. 

In accordance with ASC 740, Income Taxes , the Company recognizes a tax position in its financial statements when it is more likely than not that the position will be sustained upon examination based on the technical merits of the position. That position is then measured at the largest amount of bene- fit that is greater than 50 percent likely of being realized upon ultimate settlement. 

Employee Stock Options: The Company records stock- based compensation expense in accordance with ASC 718, Compensation — Stock Compensation . For options subject to graded vesting, the Company recognizes stock-based compensation expense ratably over the shorter of the vesting period or requisite service period. Stock-based compensation expense for grants made to retirement-eligible employees is recognized on the date of grant. 

Share Repurchases: On May 24, 2010, the Company’s Board of Directors authorized the Company to repurchase 5.0 million shares of common stock with no expiration date. On a pre-split basis, the Company purchased 0.6 million shares at an aver- age price of $42.86 during fiscal 2010 under this authorization. 

On November 22, 2010, the Board of Directors also authorized a two-for-one stock split of the Company’s common stock. As part of the Board’s approval of that stock split, the number of shares remaining to be repurchased was adjusted proportion- ately. On a post-split basis, 1.2 million shares at an average price of $39.67 were purchased during fiscal 2013 and 2.1 million shares at an average price of $28.65 were purchased during fiscal 2012, which fully depleted that program. 

On January 29, 2013, the Company’s Board of Directors autho- rized the repurchase 10.0 million shares of its common stock with no expiration date. During fiscal 2014, 1.3 million shares were purchased at an average price of $46.87 and 0.6 million shares were purchased during fiscal 2013 at an average price of $42.54 under this new authorization. 

Supplemental Cash Flow Information: Non-cash investment activities presented on the Consolidated Statements of Cash Flows generally consist of unrealized gains or losses on the Company’s rabbi trust and other investments, amortization of affordable housing investments, and amortization of bond financing costs. The noted investments are included in other assets or short-term marketable securities on the Consolidated Statements of Financial Position. Changes in the value of these investments are included in the Company’s net earnings and are presented in the Consolidated Statements of Operations as either interest and investment income (loss) or interest expense, as appropriate. 

