Rayovac 2009 Annual Report Download - page 162

Table of Contents
Index to Financial Statements SPECTRUM BRANDS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(In thousands, except per share amounts)
Shipping and handling costs, which are included in Selling expenses in the accompanying Consolidated Statements of Operations, include costs incurred
with third−party carriers to transport products to customers and salaries and overhead costs related to activities to prepare the Company’s products for
shipment at the Company’s distribution facilities.
(o) Advertising Costs
The Successor Company incurred advertising costs of $3,166 during the one month period ended September 30, 2009. The Predecessor Company incurred
expenses for advertising of $25,813, $46,417 and $55,264 during the eleven month period ended August 30, 2009, Fiscal 2008 and Fiscal 2007,
respectively. Such advertising costs are included in Selling expenses in the accompanying Consolidated Statements of Operations.
(p) Research and Development Costs
Research and development costs are charged to expense in the period they are incurred.
(q) Net (Loss) Income Per Common Share
Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted−average number of common shares
outstanding for the period. Basic net loss per common share does not consider common stock equivalents. Diluted net loss per common share reflects the
dilution that would occur if employee stock options and restricted stock awards were exercised or converted into common shares or resulted in the issuance
of common shares that then shared in the net loss of the entity. The computation of diluted net loss per common share uses the “if converted” and “treasury
stock” methods to reflect dilution. The difference between the basic and diluted number of shares is due to the effects of restricted stock and assumed
conversion of employee stock options awards.
As discussed in Note 2, Voluntary Reorganization under Chapter 11, Predecessor Company common stock was cancelled as a result of the
Company’s emergence from Chapter 11 of the Bankruptcy Code on the Effective Date. The Successor Company common stock began trading on
September 2, 2009. As such, the earnings per share information for the Predecessor Company is not meaningful to shareholders of the Successor Company’s
common shares, or to potential investors in such common shares.
Net income (loss) per common share is calculated based upon the following shares:
Successor
Company Predecessor Company
September 30,
2009 August 30, 2009 2008 2007
Basic 30,000 51,306 50,921 50,909
Effect of restricted stock and assumed conversion of stock options — — — —
Diluted 30,000 51,306 50,921 50,909
The Successor Company for the one month period ended September 30, 2009 and the Predecessor Company for the eleven month period ended
August 30, 2009, Fiscal 2008 and Fiscal 2007 has not assumed the exercise of common stock equivalents as the impact would be antidilutive.
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