Income Taxes (Tables)
|
6 Months Ended |
May 31, 2018 |
Income Tax Disclosure [Abstract] |
|
Schedule of effect of tax rate change |
The following chart shows the calculation of the previous tax rate and the new tax rate:
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|
|
Previous Rate |
New Rate |
Federal rate |
34.00 |
% |
21.00 |
% |
State rate, net of federal tax benefit |
2.45 |
% |
3.13 |
% |
Total |
36.45 |
% |
24.13 |
% |
|
Summary of temporary differences |
At May 31, 2018 and November 30, 2017, respectively, the Company had temporary differences arising from the following:
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May 31, 2018 |
|
November 30, 2017 |
Type |
|
Amount |
|
Deferred Tax |
|
Amount |
|
Deferred Tax |
Depreciation |
|
$ |
(417,190 |
) |
|
$ |
(100,661 |
) |
|
$ |
(378,580 |
) |
|
$ |
(137,992 |
) |
Reserve for bad debts |
|
23,342 |
|
|
5,632 |
|
|
6,629 |
|
|
2,416 |
|
Reserve for returns |
|
738,309 |
|
|
178,142 |
|
|
246,513 |
|
|
89,854 |
|
Accrued returns |
|
162,646 |
|
|
39,244 |
|
|
109,646 |
|
|
39,966 |
|
Reserve for obsolete inventory |
|
150,102 |
|
|
36,217 |
|
|
158,269 |
|
|
57,689 |
|
Vacation accrual |
|
32,719 |
|
|
7,895 |
|
|
70,856 |
|
|
25,827 |
|
Alternative minimum tax carry forward |
|
— |
|
|
122,360 |
|
|
— |
|
|
122,360 |
|
Deferred Compensation |
|
573,224 |
|
|
138,310 |
|
|
487,061 |
|
|
177,534 |
|
Bonus obligation unpaid |
|
— |
|
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— |
|
|
400,166 |
|
|
145,861 |
|
Charitable contributions |
|
314,843 |
|
|
75,967 |
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|
305,633 |
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|
111,403 |
|
Section 263A costs |
|
61,660 |
|
|
14,878 |
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|
48,317 |
|
|
17,612 |
|
Loss carry forward |
|
24,511,083 |
|
|
5,935,109 |
|
|
24,279,259 |
|
|
8,849,789 |
|
Net deferred tax asset |
|
$ |
26,150,738 |
|
|
$ |
6,453,093 |
|
|
$ |
25,733,769 |
|
|
$ |
9,502,319 |
|
|
Schedule of income tax expense |
Income tax expense (benefit) is made up of the following components:
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Three Months Ended |
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Six Months Ended |
|
May 31, 2018 |
|
May 31, 2017 |
|
May 31, 2018 |
|
May 31, 2017 |
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Current tax - Federal |
$ |
— |
|
|
$ |
5,000 |
|
|
$ |
— |
|
|
$ |
16,000 |
|
Current tax - State & Local |
2,675 |
|
|
2,938 |
|
|
5,349 |
|
|
5,877 |
|
Deferred tax |
(17,016 |
) |
|
407,516 |
|
|
3,093,780 |
|
|
506,217 |
|
Total Income Tax Expense |
$ |
(14,341 |
) |
|
$ |
415,454 |
|
|
$ |
3,099,129 |
|
|
$ |
528,094 |
|
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Schedule of prepaid and refundable income taxes |
Prepaid and refundable income taxes are made up of the following components:
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Prepaid and refundable income taxes |
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Federal |
|
State & Local |
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Total |
November 30, 2017 |
|
$ |
1,015 |
|
|
$ |
37,138 |
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|
$ |
38,153 |
|
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Schedule of income taxes payable |
Income taxes payable are made up of the following components:
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Income Taxes Payable |
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Federal |
|
State & Local |
|
Total |
May 31, 2018 |
|
$ |
— |
|
|
$ |
3,534 |
|
|
$ |
3,534 |
|
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Provision for income taxes computed at the statutory rate |
A reconciliation of the provision for income taxes computed at the statutory rate to the effective rate for the three months and six months ended May 31, 2018, and May 31, 2017 is as follows:
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Three Months Ended |
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Three Months Ended |
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May 31, 2018 |
|
May 31, 2017 |
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Amount |
|
Percent of Pretax Income |
|
Amount |
|
Percent of Pretax Income |
Provision for income taxes at federal statutory rate |
|
$ |
(64,399 |
) |
|
21.00 |
% |
|
$ |
378,761 |
|
|
34.00 |
% |
Changes in provision for income taxes resulting from: |
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State income taxes, net of federal income tax benefit |
|
(9,598 |
) |
|
3.13 |
% |
|
32,306 |
|
|
2.90 |
% |
Non-deductible expenses and other adjustments |
|
59,656 |
|
|
(19.45 |
)% |
|
4,387 |
|
|
0.39 |
% |
Provision for income taxes at effective rate |
|
$ |
(14,341 |
) |
|
4.68 |
% |
|
$ |
415,454 |
|
|
37.29 |
% |
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Six Months Ended |
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Six Months Ended |
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May 31, 2018 |
|
May 31, 2017 |
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Amount |
|
Percent of Pretax Income |
|
Amount |
|
Percent of Pretax Income |
Provision for (benefit from) income taxes at federal statutory rate |
|
$ |
(86,909 |
) |
|
21.00 |
% |
|
$ |
480,554 |
|
|
34.00 |
% |
Increases in taxes resulting from: |
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|
State income taxes, net of federal income tax benefit |
|
(12,954 |
) |
|
3.13 |
% |
|
40,988 |
|
|
2.90 |
% |
Change in tax rate related to future deferred tax benefits |
|
3,150,147 |
|
|
(761.18 |
)% |
|
— |
|
|
— |
% |
Non-deductible expenses and other adjustments |
|
48,845 |
|
|
(11.80 |
)% |
|
6,552 |
|
|
0.46 |
% |
Provision for (benefit from) income taxes at effective rate |
|
$ |
3,099,129 |
|
|
(748.85 |
)% |
|
$ |
528,094 |
|
|
37.36 |
% |
|