Industrial Development Subsidy

9 Months Ended

Mar. 30, 2013

Industrial Development Subsidy [Abstract]

INDUSTRIAL DEVELOPMENT SUBSIDY

14. INDUSTRIAL DEVELOPMENT SUBSIDY

As of March 30, 2013, industrial development subsidies in the amount of $12.6 million have been earned and applied for by PSE-SD from the Jinan Hi-Tech Industries Development Zone Commission based on meeting certain pre-defined criteria. The subsidies may be used for the acquisition of assets or to cover business expenses. When a subsidy is used to acquire assets, the subsidy will be amortized over the useful life of the asset. When a subsidy is used for expenses incurred, the subsidy is regarded as earned upon the incurrence of the expenditure. The remaining balance of the subsidies at March 30, 2013 was $7.4 million, which amount is expected to be recognized over the next three to twenty years.

The Company recognized $185,000 and $191,000 of industrial development subsidy as a reduction of cost of goods sold and $46,000 and $45,000 of industrial development subsidy as a reduction of operating expenses in the consolidated statement of operations for the three month periods ended March 30, 2013 and March 31, 2012, respectively. The Company recognized $1,103,000 and $880,000 of industrial development subsidy as a reduction of cost of goods sold and $136,000 and $135,000 of industrial development subsidy as a reduction of operating expenses in the consolidated statement of operations for the nine month periods ended March 30, 2013 and March 31, 2012, respectively.