Revenue Recognition

9 Months Ended

Mar. 02, 2019

Revenue from Contract with Customer [Abstract]

Satisfaction of Performance Obligation

The vast majority of the Company’s revenue is derived from contracts with customers based on the customer placing an order for products. Pricing for the most part is determined when the Company and the customer agree upon the specific order, which establishes the contract for that order.

Revenues are recognized in an amount that reflects the net consideration we expect to receive in exchange for the goods. Our shell eggs are sold at prices related to Urner Barry Spot Egg Market Quotations, negotiated prices or formulas related to our costs of production. The Company’s sales predominantly contain a single performance obligation. We recognize revenue upon satisfaction of the performance obligation with the customer which typically occurs within days of the Company and the customer agreeing upon the order.

Returns and Refunds

Some of our contracts include a guaranteed sale clause, pursuant to which we credit the customer’s account for product that the customer is unable to sell before expiration. The Company records an estimate of returns and refunds by using historical return data and comparing to current period sales and accounts receivable. The allowance is recorded as a reduction in sales with a corresponding reduction in trade accounts receivable.

Disaggregation of Revenue

The following table provides revenue disaggregated by product category (in thousands):



	13 Weeks Ended				39 Weeks Ended
	March 2, 2019		March 3, 2018		March 2, 2019		March 3, 2018
Non-specialty shell egg sales	234,960		287,259		$	659,446	$	662,017
Specialty shell egg sales	131,120		128,079		364,222		343,069
Co-pack specialty shell egg sales	7,052		6,956		20,055		18,875
Egg products	9,520		12,095		32,656		29,085
Other	1,340		1,431		4,237		6,791
	$	383,992	$	435,820	$	1,080,616	$	1,059,837

Contract Costs

The Company can incur costs to obtain or fulfill a contract with a customer. The amortization period of these costs is less than one year; therefore, they are expensed as incurred.

Contract Balances

The Company receives payment from customers based on specified terms that are generally less than 30 days from delivery. There are rarely contract assets or liabilities related to performance under the contract.

Impact of Adoption

The Company adopted the revenue recognition standard (“ASU 2014-09”) on June 3, 2018 utilizing the full retrospective method. The Company’s assessment efforts included an evaluation of certain revenue contracts with customers and related sales incentives. Adoption of ASU 2014-09 did not have an impact on the Company’s results of operations or financial position; therefore, there was no adjustment to previously reported results.