Sprouts Farmers Market 2014 Annual Report Download - page 92

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7. Property and Equipment
A summary of property and equipment, net is as follows:
As Of
December 28,
2014
December 29,
2013
Buildings ................................. $115,925 $ 106,580
Furniture, fixtures and equipment ............. 246,830 188,074
Leasehold improvements .................... 216,068 167,530
Construction in progress ..................... 58,719 14,060
Total property and equipment ............. 637,542 476,244
Accumulated depreciation and amortization ..... (182,653) (127,414)
Property and equipment, net ............. $454,889 $ 348,830
A summary of leased property and equipment under capital and financing lease obligations is as
follows:
As of
December 28,
2014
December 29,
2013
Capital Leases—Buildings
Gross asset balance .................... $ 11,338 $ 2,225
Accumulated depreciation ................ (1,364) (742)
Net............................... $ 9,974 $ 1,483
Capital Leases—Equipment
Gross asset balance .................... 498 842
Accumulated depreciation ................ (488) (657)
Net............................... $ 10 $ 185
Financing Leases
Gross asset balance .................... 129,614 104,355
Accumulated depreciation ................ (9,012) (6,204)
Net............................... $120,602 $ 98,151
Depreciation expense was $60.5 million, $47.2 million and $34.7 million for 2014, 2013 and 2012,
respectively.
During the fourth quarter of 2014, the Company determined that certain store level equipment was not
being depreciated over the proper useful lives. The Company made an entry resulting in an additional $4.4
million of depreciation expense which was recorded as Direct store expense in the Consolidated
Statements of Operations. This error correction was not material to any prior period. Also during the fourth
quarter of 2014, the Company determined that qualified store development costs were not being properly
deferred as Construction in progress until the time of store opening. This error correction, which was not
material to any prior period, resulted in an increase in Construction in progress and a reduction of Direct
store expense of $3.6 million in the Consolidated Statements of Operations.
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