Income Taxes (Tables)

12 Months Ended

Jun. 02, 2018

Schedule of Income before Income Tax, Domestic and Foreign

The components of earnings before income taxes are as follows:



(In millions)	2018		2017		2016
Domestic	$	121.6	$	131.4	$	154.9
Foreign	46.5		46.2		41.7
Total	$	168.1	$	177.6	$	196.6

Schedule of Components of Income Tax Expense (Benefit)

The provision (benefit) for income taxes consists of the following:



(In millions)	2018			2017		2016
Current: Domestic - Federal	$	30.2		$	28.7	$	36.4
Domestic - State	4.3			2.3		6.4
Foreign	10.7			11.1		6.3
	45.2			42.1		49.1
Deferred: Domestic - Federal	(4.1		)	9.2		7.5
Domestic - State	0.1			2.8		0.2
Foreign	1.2			1.0		2.7
	(2.8		)	13.0		10.4
Total income tax provision	$	42.4		$	55.1	$	59.5

Effective Income Tax Rate Reconciliation

The following table represents a reconciliation of income taxes at the United States blended statutory rate of 29.1 percent for 2018 and 35.0 percent for 2017 and 2016 with the effective tax rate as follows:



(In millions)	2018			2017			2016
Income taxes computed at the United States Statutory rate	$	49.0		$	62.2		$	68.8
Increase (decrease) in taxes resulting from:
Remeasurement of U.S. deferred tax assets and liabilities due to the Tax Act	(8.9		)	—			—
U.S. tax liability on undistributed foreign earnings due to the Tax Act	9.0			—			—
Foreign statutory rate differences	(4.0		)	(5.7		)	(4.3		)
Manufacturing deduction under the American Jobs Creation Act of 2004	(2.7		)	(3.4		)	(4.8		)
State taxes	3.3			3.8			5.2
United Kingdom patent box deduction for research and development	(1.8		)	(2.6		)	(1.7		)
Research and development credit	(2.4		)	(1.4		)	(1.4		)
Sale of manufacturing facility in the United Kingdom	—			—			(1.6		)
Other, net	0.9			2.2			(0.7		)
Income tax expense	$	42.4		$	55.1		$	59.5
Effective tax rate	25.2		%	31.1		%	30.3		%

Schedule of Deferred Tax Assets and Liabilities

The tax effects and types of temporary differences that give rise to significant components of the deferred tax assets and liabilities at June 2, 2018 and June 3, 2017, are as follows:



(In millions)	2018			2017
Deferred tax assets:
Compensation-related accruals	$	15.3		$	22.7
Accrued pension and post-retirement benefit obligations	6.6			10.9
Deferred revenue	5.6			5.3
Inventory related	1.0			4.1
Reserves for uncollectible accounts and notes receivable	0.6			1.0
Other reserves and accruals	5.2			6.1
Warranty	11.9			17.0
State and local tax net operating loss carryforwards and credits	2.3			2.7
Federal net operating loss carryforward	1.7			5.0
Foreign tax net operating loss carryforwards and credits	10.0			10.0
Accrued step rent and tenant reimbursements	3.8			4.7
Other	3.9			4.2
Subtotal	67.9			93.7
Valuation allowance	(10.3		)	(10.0		)
Total	$	57.6		$	83.7

Deferred tax liabilities:
Book basis in property in excess of tax basis	$	(25.5	)	$	(37.4	)
Intangible assets	(32.3		)	(47.3		)
Other	(6.9		)	(3.2		)
Total	$	(64.7	)	$	(87.9	)

Schedule of Unrecognized Tax Benefits

The components of the company's unrecognized tax benefits are as follows:



(In millions)
Balance at May 28, 2016	$	1.7
Increases related to current year income tax positions	0.3
Increases related to prior year income tax positions	1.1
Decreases related to prior year income tax positions	(0.1		)
Decreases related to lapse of applicable statute of limitations	(0.1		)
Decreases related to settlements	(0.1		)
Balance at June 3, 2017	2.8
Increases related to current year income tax positions	0.3
Increases related to prior year income tax positions	0.4
Decreases related to lapse of applicable statute of limitations	(0.3		)
Balance at June 2, 2018	$	3.2

Schedule of Unrecognized Tax Benefits, Interest, Penalties and Related Liability

Interest and penalties and the related liability, which are excluded from the table above, were as follows for the periods indicated:



(In millions)	June 2, 2018		June 3, 2017		May 28, 2016
Interest and penalty expense (income)	$	0.1	$	0.2	$	(0.1	)

Liability for interest and penalties	$	1.0	$	0.8