(j) intangible assets (k) revenue recognition (l)  Share-based compensation (m) deferred rent (n) Shipping and Handling costs (o) research and development On a routine basis, the Company incurs costs related to research and development activity. these costs are expensed as  incurred. Approximately $1.2 million, $1.2 million and $1.3 million were expensed in the years ended December 31, 2014, 2013  and 2012, respectively. Costs incurred related to shipping and handling are included in cost of sales. Amounts charged to customers pertaining to  these costs are included in net sales. the Company accounts for escalating rental payments on a straight-line basis over the term of the lease. the stock volatility for each grant is determined based on a review of the experience of the weighted average of historical  daily price changes of the Company’s common stock over the expected option term, and the risk-free interest rate is based  on the U.s. treasury yield curve in effect at the time of grant for periods corresponding with the expected term of the  option. the expected term is calculated based on the simplified method. the total income tax benefit recognized in the statement of operations for share-based compensation arrangements was  approximately $320,000, $280,000 and $270,000, for the years ended December 31, 2014, 2013 and 2012, respectively. the Company issues share-based awards through several plans that are described in detail in note 12. the compensation  cost charged against income for those plans is included in selling, general & administrative expenses as follows (in  thousands): When accounting for equity instruments exchanged for employee services, share-based compensation cost is measured  at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the employee’s  requisite service period (generally the vesting period of the equity grant).  the Company recognizes revenue at the time of shipment when title and risk of loss have passed to the customer,  persuasive evidence of an arrangement exists, performance of its obligation is complete, its price to the buyer is fixed or  determinable, and the Company is reasonably assured of collection. If a loss is anticipated on any contract, a provision for  the entire loss is made immediately. Determination of these criteria, in some cases, requires management’s judgment.  Intangible assets with a definite life are amortized on a straight-line basis, with estimated useful lives ranging from 5 to 14  years. Intangible assets with a definite life are tested for impairment whenever events or circumstances indicate that their  carrying values may not be recoverable.  the compensation expense for stock options granted during the three-year period ended December 31, 2014, was  determined as the fair value of the options using the Black scholes valuation model. the 2013 compensation expense for  stock options granted prior to January 1, 2012, was determined as the fair value of the options using a lattice-based option  valuation model. the assumptions are noted as follows: Year ended december 31 2014 2013 2012 share-based compensation expense  $ 1,119 $ 924 $ 860 Year ended december 31 2014 2013 2012 expected volatility  32.8% to 37.9%  34.0% to 50.0%  56.9% expected dividends  none  none  none Risk-free interest rate  0.7% to 0.9%  0.4% to 0.7%  0.39% exercise price  Closing price on  Closing price on Closing price on  date of grant  date of grant  date of grant expected term  3.8 to 5.0 years  3.3 to 5.0 years  5 years Weighted-average grant-date fair value  $ 7.24  $ 5.84  $ 7.72 23