Advance Auto Parts 2006 Annual Report Download - page 86

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ADVANCE AUTO PARTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
December 30, 2006, December 31, 2005 and January 1, 2005
(in thousands, except per share data)
Depreciation of building and leasehold improvements is provided over the shorter of the original useful lives of the
respective assets or the term of the lease using the straight-line method. The term of the lease is generally the initial
term of the lease unless external economic factors exist such that renewals are reasonably assured in which case, the
renewal period would be included in the lease term for purposes of establishing an amortization period. Depreciation
expense was $138,064, $119,938 and $104,877 for the fiscal years ended 2006, 2005 and 2004, respectively.
Property and equipment consists of the following:
O
r
i
g
i
nal
Useful Lives
December
30
,
2006
December
31
,
2005
Land and land improvements 0 - 10 years 238,186$ 212,110$
Buildings 40 years 328,997 295,699
Building and leasehold improvements 10 - 40 years 197,657 159,568
Furniture, fixtures and equipment 3 - 12 years 843,645 745,142
Vehicles 2 - 10 years 24,682 35,339
Construction in progress 28,151 11,035
Other 4,230 4,516
1,665,548 1,463,409
Less - Accumulated depreciation and amortization (670,571) (564,558)
Property and equipment, net 994,977$ 898,851$
The Company capitalized approximately $3,641, $6,584 and $4,625 incurred for the development of internal
use computer software in accordance with the American Institute of Certified Public Accountant’s Statement of
Position 98-1, “Accounting for the Cost of Computer Software Developed or Obtained for Internal Use” during
fiscal 2006, fiscal 2005 and fiscal 2004, respectively. These costs are included in the furniture, fixtures and
equipment category above and are depreciated on the straight-line method over three to seven years.
10. Accrued Expenses:
Accrued expenses consist of the following:
December 30, December 31,
2006 2005
Payroll and related benefits 48,477$ 58,553$
Warrant
y
13,069 11,352
Capital expenditures 24,011 39,105
Self-insurance reserves 58,755 39,840
Property taxes 23,427 20,029
Other 85,236 96,558
Total accrued expenses 252,975$ 265,437$
F-23