Quarterly report pursuant to Section 13 or 15(d)

Income Taxes (Tables)

v3.8.0.1
Income Taxes (Tables)
3 Months Ended
Feb. 28, 2018
Income Tax Disclosure [Abstract]  
Schedule of effect of tax rate change The following chart shows the effect of the tax rate change on the Company's Consolidated Statements of Operations:

 
Previous 36.45% Rate
Effect of Rate Change
New 24.13% Rate
Loss before provision for Income Taxes
$
(107,189
)
$

$
(107,189
)
(Benefit) provision for Income Taxes
(36,676
)
3,150,146

3,113,470

Net Loss
$
(70,513
)
$
(3,150,146
)
$
(3,220,659
)
 
 
 
 
Loss per Share:
 
 
 
    Basic
(0.01
)
(0.44
)
(0.45
)
    Diluted
(0.01
)
(0.44
)
(0.45
)
 
 
 
 
Weighted Average Shares Outstanding:
 
 
 
Basic
7,126,684

7,126,684

7,126,684

Diluted
7,126,684

7,126,684

7,126,684



The following chart shows the calculation of the previous tax rate and the new tax rate:

 
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 February 28, 2018 and November 30, 2017, respectively, the Company had temporary differences arising from the following:

 
 
February 28, 2018
 
November 30, 2017
Type
 
Amount
 
Deferred Tax
 
Amount
 
Deferred Tax
Depreciation
 
$
(391,637
)
 
$
(94,496
)
 
$
(378,580
)
 
$
(137,992
)
Reserve for bad debts
 
23,788

 
5,740

 
6,629

 
2,416

Reserve for returns
 
209,300

 
50,501

 
246,513

 
89,854

Accrued returns
 
96,114

 
23,191

 
109,646

 
39,966

Reserve for obsolete inventory
 
145,797

 
35,178

 
158,269

 
57,689

Vacation accrual
 
59,297

 
14,307

 
70,856

 
25,827

Alternative minimum tax carry forward
 

 
122,360

 

 
122,360

Deferred compensation
 
519,539

 
125,356

 
487,061

 
177,534

Bonus obligation unpaid
 
400,166

 
96,554

 
400,166

 
145,861

Charitable contributions
 
312,343

 
75,363

 
305,633

 
111,403

Section 263A costs
 
57,296

 
13,825

 
48,317

 
17,612

Loss carry forward
 
24,418,338

 
5,926,785

 
24,279,259

 
8,849,789

Net deferred tax asset
 
$
25,850,341

 
$
6,394,664

 
$
25,733,769

 
$
9,502,319

Schedule of income tax expense Income tax expense (benefit) is made up of the following components:
 
Three Months Ended
 
 
February 28, 2018
 
February 28, 2017
 
Current tax - Federal
$

 
$
11,000

 
Current tax - State & Local
2,674

 
2,939

 
Deferred tax
3,110,796

 
98,701

 
Total income tax expense
$
3,113,470

 
$
112,640

 
Schedule of prepaid and refundable income taxes Prepaid and refundable income taxes are made up of the following components:
Prepaid and refundable income taxes
 
Federal
 
State &
Local
 
Total
February 28, 2018
 
$
1,015

 
$
34,464

 
$
35,479

November 30, 2017
 
$
1,015

 
$
37,138

 
$
38,153

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 ended February 28, 2018, and February 28, 2017 is as follows:

 
 
Three Months Ended
 
Three Months Ended
 
 
February 28, 2018
 
February 28, 2017
 
 
Amount
 
Percent of Pretax Income
 
Amount
 
Percent of Pretax Income
Provision for income taxes at federal statutory rate
 
$
(22,510
)
 
21.00
 %
 
$
101,793

 
34.00
%
Changes in provision for income taxes resulting from:
 
 
 
 
 
 
 
 
State income taxes, net of federal income tax benefit
 
(3,355
)
 
3.13
 %
 
7,335

 
2.45
%
Change in tax rate related to future deferred tax benefits
 
3,150,147

 
(2,938.87
)%
 

 
%
Non-deductible expenses and other adjustments
 
(10,812
)
 
10.09
 %
 
3,512

 
1.17
%
Provision for income taxes at effective rate
 
$
3,113,470

 
(2,904.65
)%
 
$
112,640

 
37.62
%