Income Taxes (Tables)
|
9 Months Ended |
Aug. 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 August 31, 2018 and November 30, 2017, respectively, the Company had temporary differences arising from the following:
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August 31, 2018 |
|
November 30, 2017 |
Type |
|
Amount |
|
Deferred Tax |
|
Amount |
|
Deferred Tax |
Depreciation |
|
$ |
(468,017 |
) |
|
$ |
(112,925 |
) |
|
$ |
(378,580 |
) |
|
$ |
(137,992 |
) |
Reserve for bad debts |
|
15,368 |
|
|
3,708 |
|
|
6,629 |
|
|
2,416 |
|
Reserve for returns |
|
619,185 |
|
|
149,399 |
|
|
246,513 |
|
|
89,854 |
|
Accrued returns |
|
110,436 |
|
|
26,646 |
|
|
109,646 |
|
|
39,966 |
|
Reserve for obsolete inventory |
|
135,164 |
|
|
32,613 |
|
|
158,269 |
|
|
57,689 |
|
Vacation accrual |
|
52,233 |
|
|
12,603 |
|
|
70,856 |
|
|
25,827 |
|
Alternative minimum tax carry forward |
|
— |
|
|
103,040 |
|
|
— |
|
|
122,360 |
|
Research and development tax credit |
|
— |
|
|
65,175 |
|
|
— |
|
|
— |
|
Deferred Compensation |
|
491,382 |
|
|
118,563 |
|
|
487,061 |
|
|
177,534 |
|
Bonus obligation unpaid |
|
— |
|
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— |
|
|
400,166 |
|
|
145,861 |
|
Charitable contributions |
|
242,650 |
|
|
58,548 |
|
|
305,633 |
|
|
111,403 |
|
Section 263A costs |
|
208,120 |
|
|
50,216 |
|
|
48,317 |
|
|
17,612 |
|
Loss carry forward |
|
24,789,723 |
|
|
5,990,894 |
|
|
24,279,259 |
|
|
8,849,789 |
|
Net deferred tax asset |
|
$ |
26,196,244 |
|
|
$ |
6,498,480 |
|
|
$ |
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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Nine Months Ended |
|
August 31, 2018 |
|
August 31, 2017 |
|
August 31, 2018 |
|
August 31, 2017 |
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|
Current tax - Federal |
$ |
— |
|
|
$ |
43,875 |
|
|
$ |
— |
|
|
$ |
59,875 |
|
Current tax - State & Local |
595 |
|
|
312 |
|
|
5,944 |
|
|
6,189 |
|
Deferred tax |
(70,273 |
) |
|
310,629 |
|
|
3,023,507 |
|
|
816,846 |
|
Total Income Tax (Benefit) Expense |
$ |
(69,678 |
) |
|
$ |
354,816 |
|
|
$ |
3,029,451 |
|
|
$ |
882,910 |
|
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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 |
|
Total |
August 31, 2018 |
|
$ |
20,335 |
|
|
$ |
7,449 |
|
|
$ |
27,784 |
|
November 30, 2017 |
|
$ |
1,015 |
|
|
$ |
37,138 |
|
|
$ |
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 |
|
Federal |
|
State & Local |
|
Total |
August 31, 2018 |
|
$ |
— |
|
|
$ |
950 |
|
|
$ |
950 |
|
|
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 nine months ended August 31, 2018, and August 31, 2017 is as follows:
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Three Months Ended |
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Three Months Ended |
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|
August 31, 2018 |
|
August 31, 2017 |
|
|
Amount |
|
Percent of Pretax Income |
|
Amount |
|
Percent of Pretax Income |
Provision for income taxes at federal statutory rate |
|
$ |
(57,404 |
) |
|
21.00 |
% |
|
$ |
249,050 |
|
|
34.00 |
% |
Changes in provision for income taxes resulting from: |
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State income taxes, net of federal income tax benefit |
|
(8,556 |
) |
|
3.13 |
% |
|
21,242 |
|
|
2.90 |
% |
Non-deductible expenses and other adjustments |
|
(3,718 |
) |
|
1.36 |
% |
|
84,524 |
|
|
11.54 |
% |
(Benefit from) Provision for income taxes at effective rate |
|
$ |
(69,678 |
) |
|
25.49 |
% |
|
$ |
354,816 |
|
|
48.44 |
% |
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Nine Months Ended |
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Nine Months Ended |
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|
August 31, 2018 |
|
August 31, 2017 |
|
|
Amount |
|
Percent of Pretax Income |
|
Amount |
|
Percent of Pretax Income |
Provision for (benefit from) income taxes at federal statutory rate |
|
$ |
(144,312 |
) |
|
21.00 |
% |
|
$ |
729,604 |
|
|
34.00 |
% |
Increases in taxes resulting from: |
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State income taxes, net of federal income tax benefit |
|
(21,509 |
) |
|
3.13 |
% |
|
62,231 |
|
|
2.90 |
% |
Change in tax rate related to future deferred tax benefits |
|
3,150,147 |
|
|
(458.40 |
)% |
|
— |
|
|
— |
% |
Non-deductible expenses and other adjustments |
|
45,125 |
|
|
(6.57 |
)% |
|
91,075 |
|
|
4.24 |
% |
Provision for income taxes at effective rate |
|
$ |
3,029,451 |
|
|
(440.84 |
)% |
|
$ |
882,910 |
|
|
41.14 |
% |
|