Income Taxes

9 Months Ended

May 29, 2016

Income Tax Disclosure [Abstract]

Income Taxes

4. INCOME TAXES:

The Company’s effective tax rate in its fiscal 2016 third quarter was 24.9% as compared to 8.8% in its fiscal 2015 third quarter. The Company has determined that certain of its activities the Company performs qualify for the Research & Development tax credit (R&D credit) as defined by Internal Revenue Code Section 41. During the fiscal 2015 third quarter, the Company recognized a tax benefit that related to actual R&D credits claimed in its fiscal year 2014 federal and state tax returns as well as estimated R&D credits for fiscal year 2015.

The fiscal 2016 year-to-date effective tax rate was a negative (251.9) % as compared to 25.9% for the prior year. During the fiscal 2016 first quarter the Company recognized tax benefits related to R&D tax credits which were generated in a prior year which lowered the overall effective tax rate. In addition, during the Company’s fiscal second quarter, the Federal R&D tax credit law was retroactively renewed for calendar year 2015 and also made permanent going forward. Since for calendar year 2015 the law was enacted retroactively, any effects were recognized as a component of income tax expense or benefit from continuing operations in the financial statements in the interim period that the law was enacted, which in this case was the Company’s fiscal 2016 second quarter.