| Summary of temporary differences |
At February 28, 2015 and November 30, 2014, respectively, the Company had temporary differences arising from the following:
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February 28, 2015 |
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Classified As |
Type |
|
Amount |
|
Deferred Tax |
|
Short-Term
Asset |
|
Long-Term
Asset |
Depreciation |
|
$ |
(661,250 |
) |
|
$ |
(244,025 |
) |
|
$ |
— |
|
|
$ |
(244,025 |
) |
Reserve for bad debts |
|
32,095 |
|
|
11,844 |
|
|
11,844 |
|
|
— |
|
Reserve for returns |
|
2,480,934 |
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|
915,556 |
|
|
915,556 |
|
|
— |
|
Reserve for obsolete inventory |
|
735,500 |
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|
271,427 |
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|
271,427 |
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|
— |
|
Vacation accrual |
|
156,337 |
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|
57,694 |
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|
57,694 |
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|
— |
|
Accrued bonus |
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222,000 |
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|
81,926 |
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|
81,926 |
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Charitable contributions |
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1,101,040 |
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|
406,324 |
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132,853 |
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|
273,471 |
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Section 263A costs |
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115,672 |
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|
42,687 |
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|
42,687 |
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— |
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Loss carry forward |
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22,914,148 |
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8,289,085 |
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1,328,532 |
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6,960,553 |
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Net deferred tax asset (liability) |
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$ |
9,832,518 |
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$ |
2,842,519 |
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$ |
6,989,999 |
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November 30, 2014 |
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Classified As |
Type |
|
Amount |
|
Deferred Tax |
|
Short-Term
Asset |
|
Long-Term
(Liability) |
Depreciation |
|
$ |
(685,154 |
) |
|
$ |
(252,883 |
) |
|
$ |
— |
|
|
$ |
(252,883 |
) |
Unrealized (gain) on investments |
|
— |
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— |
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— |
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— |
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Reserve for bad debts |
|
25,124 |
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|
9,272 |
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|
9,272 |
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— |
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Reserve for returns |
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2,942,544 |
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1,085,907 |
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|
1,085,907 |
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— |
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Reserve for obsolete inventory |
|
608,504 |
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|
224,560 |
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|
224,560 |
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— |
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Vacation accrual |
|
148,751 |
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54,895 |
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54,895 |
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— |
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Charitable contributions |
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1,100,940 |
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|
406,287 |
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132,853 |
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|
273,434 |
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Section 263A costs |
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128,079 |
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47,266 |
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47,266 |
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— |
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Loss carry forward |
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22,933,333 |
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8,296,176 |
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1,328,532 |
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6,967,644 |
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Net deferred tax asset (liability) |
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$ |
9,871,480 |
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$ |
2,883,285 |
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$ |
6,988,195 |
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| Provision for income taxes computed at the statutory rate |
A reconciliation of the provision for (benefit from) income taxes computed at the statutory rate to the effective rate for the three months ended February 28, 2015, and February 28, 2014 is as follows:
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Three Months Ended |
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Three Months Ended |
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February 28, 2015 |
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February 28, 2014 |
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Amount |
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Percent of Pretax Income |
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Amount |
|
Percent of Pretax Income |
Continuing Operations |
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Provision for (benefit from) income taxes at federal statutory rate |
|
$ |
33,523 |
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|
34.00 |
% |
|
$ |
(563,080 |
) |
|
34.00 |
% |
Changes in provision (benefit) for income taxes resulting from: |
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State income taxes, net of federal income tax benefit |
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2,859 |
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2.90 |
% |
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(48,027 |
) |
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2.90 |
% |
Non-deductible expenses and other adjustments |
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4,606 |
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|
4.67 |
% |
|
1,644 |
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(0.10 |
)% |
Provision for (Benefit from) income taxes at effective rate |
|
40,988 |
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|
41.57 |
% |
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(609,463 |
) |
|
36.80 |
% |
Discontinued Operations |
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(Benefit from) income taxes at federal statutory rate |
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$ |
— |
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|
— |
% |
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$ |
(103,781 |
) |
|
34.00 |
% |
Changes in benefit from income taxes resulting from: |
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State income taxes, net of federal income tax benefit |
|
— |
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— |
% |
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(8,851 |
) |
|
2.90 |
% |
Non-deductible expenses and other adjustments |
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— |
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— |
% |
|
302 |
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(0.10 |
)% |
Benefit from income taxes at effective rate for Discontinued Operations |
|
$ |
— |
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— |
% |
|
$ |
(112,330 |
) |
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36.80 |
% |
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Total provision for (benefit from) income taxes at effective rate |
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$ |
40,988 |
|
|
41.57 |
% |
|
$ |
(721,793 |
) |
|
36.80 |
% |
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