Leasing Arrangements

12 Months Ended

Dec. 31, 2014

Leases [Abstract]

Leasing Arrangements

Leasing Arrangements

The Company leases certain office and warehouse facilities, retail stores and machinery and equipment under noncancellable capital and operating leases that expire at various dates through 2026. Many leases include renewal and/or fair value purchase options.

Future minimum capital and operating lease payments at December 31, 2014 are:

	Capital Leases		Operating Leases
2015	$	1,732	$	34,316
2016	1,732		27,196
2017	1,732		19,635
2018	2,022		15,630
2019	1,521		11,595
Subsequent to 2019	3,997		25,193
Total minimum lease payments	12,736		$	133,565
Amounts representing interest	1,098
Present value of net minimum lease payments	11,638
Current maturities	1,467
Long-term capital lease obligation	$	10,171

Rental expense for all operating leases was $39.8 million, $45.0 million and $42.9 million in 2014, 2013 and 2012, respectively. The Company also recognized $0.7 million, $0.6 million and $0.6 million in 2014, 2013 and 2012, respectively, for rental income on subleases of equipment and buildings under operating leases in which it was the lessee.

KC accrued $1.2 million in early lease termination penalties within Selling, general, and administrative expenses for the year ended December 2014. These penalties arose as a result of early exit provisions in certain operating lease contracts permitting the company to exit these sites in the first half of 2015 rather than upon lease expiration in outlying years.

Assets recorded under capital leases are included in property, plant and equipment and consist of the following:

	December 31
	2014		2013
Plant and equipment	$	4,807	$	14,509
Less accumulated depreciation	1,927		1,650
	$	2,880	$	12,859

Depreciation of plant and equipment under capital leases is included in depreciation expense in each of the years ended December 31, 2014, 2013 and 2012.

Capital lease obligations of $2.2 million and $9.3 million were incurred in connection with lease agreements to acquire plant and equipment during 2013 and 2012, respectively. No capital lease obligations were incurred in 2014.