On July 1, 2019, we adopted new lease accounting guidance, which requires a lessee to record right-of-use assets and lease liabilities based upon the present value of the lease payments for operating leases and finance leases. We used the alternate transition method whereby companies could recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption rather than restating comparative periods, but we did not record a cumulative-effect adjustment from initially applying the standard.

We have operating leases with initial noncancelable lease terms in excess of one year covering the rental of various facilities and equipment. Certain of these leases contain renewal options and some provide options to purchase during the lease term. Our operating leases include leases for real estate for some of our office and manufacturing facilities as well as manufacturing and non-manufacturing equipment used in our business. The remaining lease terms for these operating leases range from 1 year to 7 years.

We have finance leases with initial noncancelable lease terms in excess of one year covering the rental of various facilities and equipment. These leases are generally for non-manufacturing equipment used in our business and warehouse facilities. The remaining lease terms for these finance leases range from 2 years to 4 years.

•Whether we obtain substantially all of the economic benefits from the use of that underlying asset, and we can direct how and for what purpose the asset is used during the term of the contract.

In determining how to allocate consideration between lease and non-lease components in a contract that was deemed to contain a lease, we used judgment and consistent application of assumptions to reasonably allocate the consideration.

We have leases which contain options to extend or terminate the leases. On a lease-by-lease basis, we have determined if the extension should be considered reasonably certain to be exercised and thus a right-of-use asset and a lease liability should be recorded.

The discount rate for leases, if not explicitly stated in the lease, is the incremental borrowing rate, which is the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment.

We use a discount rate to calculate the present value of lease liabilities. In the development of the discount rate, we consider our internal borrowing rate, treasury security rates, collateral and credit risk specific to us, and our lease portfolio characteristics.

As of June 30, 2021 and 2020, the weighted-average discount rate of our operating leases was 2.9% and 3.0%, respectively. As of June 30, 2021 and 2020, the weighted-average discount rate of our finance leases was 1.9% and 3.6%, respectively.

We elected the package of practical expedients that permits us not to reassess our prior conclusions about lease identification, lease classification and initial direct costs and made an accounting policy election to exclude short-term leases with an initial term of 12 months or less from our Consolidated Balance Sheets.


	2021		2020
Operating lease cost in Cost of Sales and Selling, General and Administrative Expenses	$	8,300	$	8,726
Finance lease cost:
Amortization of assets in Cost of Sales	$	1,571	$	335
Interest on lease liabilities in Other, Net	156		73
Total finance lease cost	$	1,727	$	408
Short-term lease cost in Cost of Sales and Selling, General and Administrative Expenses	2,652		2,405
Total net lease cost	$	12,679	$	11,539


	2021		2020
Operating Leases
Operating Lease Right-Of-Use Assets	$	22,455	$	22,977

Current operating lease liabilities in Accrued Liabilities	$	6,861	$	6,766
Noncurrent Operating Lease Liabilities	17,228		17,893
Total operating lease liabilities	$	24,089	$	24,659

Finance Leases


Finance lease right-of-use assets in Property, Plant and Equipment-Net	$	9,212	$	2,346

Current finance lease liabilities in Accrued Liabilities	$	2,517	$	571
Noncurrent finance lease liabilities in Other Noncurrent Liabilities	6,667		1,580
Total finance lease liabilities	$	9,184	$	2,151


	2021		2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	8,501	$	8,923
Operating cash flows from finance leases	$	156	$	73
Financing cash flows from finance leases	$	2,002	$	432

Supplemental noncash information on operating lease liabilities arising from obtaining right-of-use assets	$	7,005	$	5,611
Supplemental noncash information on operating lease liabilities removed due to purchase of leased asset	$	—	$	5,765
Supplemental noncash information on finance lease liabilities arising from obtaining right-of-use assets	$	9,035	$	631


	Operating Leases		Finance Leases
2022	$	7,466	$	2,666
2023	5,809		2,475
2024	4,943		2,095
2025	2,910		1,973
2026	2,654		306
Thereafter	1,949		—
Total minimum payments	$	25,731	$	9,515
Less amount representing interest	(1,642)		(331)
Present value of lease obligations	$	24,089	$	9,184

As of June 30, 2021 and 2020, the weighted-average remaining term of our operating leases was 4.4 years and 4.7 years, respectively. As of June 30, 2021 and 2020, the weighted-average remaining term of our finance leases was 4.0 years and 3.8 years, respectively.