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Income Taxes (Tables)

12 Months Ended

Aug. 25, 2012

The provision for income taxes consists of the following (in thousands):

Year ended	August 25, 2012			August 27, 2011			August 28, 2010
Current:
Federal	$	43,470		$	22,372		$	34,373
Foreign		3,604			3,664			4,336
State		8,066			5,089			6,871
Total current		55,140			31,125			45,580

Deferred:
Federal		540			11,424			154
Foreign		90			(94	)		366
State		(25	)		1,631			344
Total deferred		605			12,961			864

Total	$	55,745		$	44,086		$	46,444

Reconciliation of provision for income taxes

The following table reconciles the provision for income taxes using the statutory federal income tax rate to the actual provision for income taxes (in thousands):

	August 25, 2012			August 27, 2011			August 28, 2010
Income taxes at the statutory federal income tax rate		35.0	%		35.0	%		35.0	%
State income taxes		3.5			3.7			3.8
Adjustments to tax reserves		-0.6			-1.1			-0.7
Foreign tax rate differential		-1.0			-1.0			-0.6
Permanent and other		0.1			0.0			0.3
Total		37.0	%		36.6	%		37.8	%

Components of deferred tax (assets) liabilities

The tax effect of items giving rise to the Company's deferred tax assets and liabilities is as follows (in thousands):

	August 25, 2012		August 27, 2011
Deferred Tax Assets
Payroll and benefit related	$	15,577	$	14,171
Insurance related		12,928		11,831
Environmental		7,886		7,235
Other		12,588		10,207
		48,979		43,444

Deferred Tax Liabilities
Tax in excess of book depreciation		42,282		39,317
Purchased intangible assets		26,666		24,619
Rental merchandise in service		20,992		21,325
Other		-		145
		89,940		85,406

Net deferred tax liability	$	40,961	$	41,962

Reconciliation of unrecognized tax benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):

Balance at August 28, 2010	$	3,556
Additions based on tax positions related to the current year		253
Statute expirations		(1,256	)
Other adjustments		(233	)

Balance at August 27, 2011	$	2,320
Additions based on tax positions related to the current year		137
Statute expirations		(1,406	)

Balance at August 25, 2012	$	1,051

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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