Summary of temporary differences |
At November 30, 2018 and November 30, 2017, respectively, the Company had temporary differences arising from the following:
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November 30, 2018 |
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November 30, 2017 |
Type |
|
Amount |
|
Deferred Tax |
|
Amount |
|
Deferred Tax |
Depreciation |
|
$ |
(379,909 |
) |
|
$ |
(90,802 |
) |
|
$ |
(378,580 |
) |
|
$ |
(137,992 |
) |
Reserve for bad debts |
|
10,489 |
|
|
2,507 |
|
|
6,629 |
|
|
2,416 |
|
Reserve for returns |
|
182,692 |
|
|
43,665 |
|
|
246,513 |
|
|
89,854 |
|
Accrued returns |
|
96,592 |
|
|
23,086 |
|
|
109,646 |
|
|
39,966 |
|
Reserve for obsolete inventory |
|
25,483 |
|
|
6,091 |
|
|
158,269 |
|
|
57,689 |
|
Vacation accrual |
|
81,005 |
|
|
19,361 |
|
|
70,856 |
|
|
25,827 |
|
Alternative minimum tax carry forward |
|
— |
|
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103,040 |
|
|
— |
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|
122,360 |
|
Research and development credit carry forward |
|
— |
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65,175 |
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|
— |
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— |
|
Deferred compensation |
|
351,764 |
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|
84,075 |
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487,061 |
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177,534 |
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Bonus obligations unpaid |
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70,686 |
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16,895 |
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400,166 |
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|
145,861 |
|
Charitable contributions |
|
245,650 |
|
|
58,713 |
|
|
305,633 |
|
|
111,403 |
|
Section 263A costs |
|
206,283 |
|
|
49,304 |
|
|
48,317 |
|
|
17,612 |
|
Loss carry forward |
|
24,277,762 |
|
|
5,768,532 |
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24,279,259 |
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|
8,849,789 |
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Net deferred tax asset |
|
$ |
25,168,497 |
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|
$ |
6,149,642 |
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$ |
25,733,769 |
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|
$ |
9,502,319 |
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Schedule of income tax expense |
Income tax expense (benefit) is made up of the following components:
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November 30, |
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2018 |
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2017 |
|
Current tax - Federal |
|
$ |
17,382 |
|
|
$ |
105,770 |
|
|
Current tax - State and Local |
|
10,210 |
|
|
5,640 |
|
|
Deferred tax expense |
|
3,352,676 |
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|
1,062,144 |
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|
$ |
3,380,268 |
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|
$ |
1,173,554 |
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Provision for income taxes computed at the statutory rate |
A reconciliation of the (benefit from) provision for income taxes computed at the statutory rate to the effective rate for the years ended November 30, 2018 and 2017 is as follows:
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2018 |
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2017 |
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Amount |
|
Percent of Pretax Income |
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Amount |
|
Percent of Pretax Income |
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Provision for (benefit from) income taxes at federal statutory rate |
|
$ |
12,285 |
|
|
21.00 |
% |
|
$ |
1,021,610 |
|
|
34.00 |
% |
|
Changes in provision for (benefit from) income taxes resulting from: |
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State income taxes, net of federal income tax benefit |
|
1,697 |
|
|
2.90 |
% |
|
73,616 |
|
|
2.45 |
% |
|
Change in tax rate related to future deferred tax benefits |
|
3,146,636 |
|
|
5,378.68 |
% |
|
— |
|
|
— |
% |
|
Non-deductible expenses and other adjustments |
|
219,650 |
|
|
375.46 |
% |
|
78,328 |
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|
2.61 |
% |
|
Provision for (benefit from) income taxes at effective rate |
|
$ |
3,380,268 |
|
|
5,778.04 |
% |
|
$ |
1,173,554 |
|
|
39.06 |
% |
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