Property, Equipment And Capital Leases

12 Months Ended

Aug. 31, 2016

Property, Equipment And Capital Leases [Abstract]

7. Property, Equipment and Capital Leases

Property, equipment and capital leases consist of the following at August 31:



	Estimated
	Useful Life	2016		2015
Property, equipment and capital leases:
Land		$	154,420	$	157,861
Buildings and improvements	8 – 25 yrs		341,956		343,598
Drive-In equipment	5 – 7 yrs		132,678		139,494
Brand technology development and other equipment	2 – 5 yrs		110,364		92,825
Property and equipment, at cost			739,418		733,778
Accumulated depreciation			(352,390)		(330,219)
Property and equipment, net			387,028		403,559

Capital leases	Life of lease		43,991		48,079
Accumulated amortization			(28,857)		(30,232)
Capital leases, net			15,134		17,847
Property, equipment and capital leases, net		$	402,162	$	421,406

Depreciation expense for property and equipment was $40.4 million, $41.7 million and $37.6 million for fiscal years 2016, 2015 and 2014, respectively. Land, buildings and equipment with a carrying amount of $156.6 million at August 31, 2016, were leased under operating leases to franchisees and other parties. The accumulated depreciation related to these buildings and equipment was $62.5 million at August 31, 2016. Amortization expense related to capital leases is included within “depreciation and amortization” on the Consolidated Statements of Income. As of August 31, 2016, the Company had 11 drive-ins under construction with costs to complete.

Interest incurred in connection with the construction of new drive-ins and technology projects is capitalized. Capitalized interest was $0.6 million, $0.4 million and $0.5 million for fiscal years 2016, 2015 and 2014, respectively.