NOTE 3 – PROPERTY AND EQUIPMENT

Property and equipment are stated at historical cost. The historical cost of acquiring an asset includes the costs incurred to bring it to the condition and location necessary for its intended use. Depreciation is computed on the straight-line basis over the estimated useful lives of the assets. The useful life of fixtures and equipment ranges from three to 15 years and that of certain components of building improvements and buildings from 10 to 25 years. Leasehold improvements are amortized over the shorter of the life of the improvement or the expected term of the lease. In some locations, leasehold improvements are amortized over a period longer than the initial lease term where management believes it is reasonably assured that the renewal option in the underlying lease will be exercised because an economic penalty may be incurred if the option is not exercised. The sale or purchase of property and equipment is recognized upon legal transfer of property.

Property and equipment consist of the following (in thousands):



	August 31,		August 31,
	2018		2017
Land	$	172,051	$	161,579
Building and improvements		424,736		382,236
Fixtures and equipment		228,891		198,147
Construction in progress		38,495		40,224
Total property and equipment, historical cost		864,173		782,186
Less: accumulated depreciation		(269,770)		(224,357)
Property and equipment, net	$	594,403	$	557,829

Depreciation and amortization expense (in thousands):



	Years Ended August 31,
	2018		2017		2016
Depreciation and amortization expense, Property and equipment	$	51,520	$	46,292	$	39,794

The Company capitalizes interest on expenditures for qualifying assets over a period that covers the duration of the activities required to get the asset ready for its intended use, provided that expenditures for the asset have been made and interest cost is being incurred. Interest capitalization continues as long as those activities and the incurrence of interest cost continue. The amount capitalized in an accounting period is determined by applying the Company’s consolidated capitalization rate (average interest rate) to the average amount of accumulated expenditures for the qualifying asset, for each country, during the period. The capitalization rates are based on the interest rates applicable to borrowings outstanding during the period.

Total interest capitalized (in thousands):

Total interest capitalized (in thousands):



	Years Ended August 31,
	2018		2017		2016
Interest capitalized	$	1,134	$	447	$	1,082

A summary of asset disposal activity for fiscal years 2018, 2017 and 2016 is as follows (in thousands):



	Historical Cost		Accumulated Depreciation		Receivables and Proceeds from Disposal		Gain/(Loss) Recognized
Fiscal Year 2018	$	10,465	$	8,388	$	738	$	(1,339)
Fiscal Year 2017	$	19,774	$	17,436	$	377	$	(1,961)
Fiscal Year 2016	$	7,578	$	6,330	$	86	$	(1,162)

The Company also recorded within accounts payable and other accrued expenses approximately $81,000 and $1.4 million, respectively, as of August 31, 2018 and $612,000 and $3.1 million, respectively, as of August 31, 2017 of liabilities related to the acquisition and/or construction of property and equipment.

Balance as of

August 31,

August 31,

Total interest capitalized