INCOME TAXES (Tables)

12 Months Ended

Jun. 30, 2022

INCOME TAXES [Abstract]

Income Tax Net (Expense) Benefit

The Company’s income tax net (expense) benefit for the periods presented comprises the following:

	Year Ended June 30,
	2022			2021
Current:
Federal	$	-		$	-
State		(19,606	)		(18,409	)
Total current expense		(19,606	)		(18,409	)
Deferred:
Federal		(493,910	)		6,062,222
State		(5,016	)		288,608
Total deferred (expense) benefit		(498,926	)		6,350,830
Income tax net (expense) benefit	$	(518,532	)	$	6,332,421

Noncurrent Deferred Tax Assets, Net

Significant components of the Company’s noncurrent deferred tax assets, net, as of the dates presented are as follows:

	June 30,
	2022			2021
Deferred tax assets:
Reversals and accruals	$	487,333		$	454,846
Federal net operating loss (“NOL”) carryforwards		3,471,594			3,989,278
State NOL carryforwards		532,300			585,563
Hong Kong NOL carryforwards		995,566			995,566
Federal benefit on state taxes under uncertain tax positions		-			2,073
Stock-based compensation		155,139			149,047
Section 263A adjustment		118,916			122,562
Inventory valuation reserve		1,631,339			1,605,871
Operating lease liabilities		850,910			942,471
Valuation allowance		(1,442,213	)		(1,452,296	)
Noncurrent deferred tax assets, net		6,800,884			7,394,981
Deferred tax liabilities:
Prepaid expenses		(52,792	)		(44,890	)
Depreciation		(255,734	)		(105,369	)
Operating lease right-of-use assets		(640,454	)		(893,892	)
Noncurrent deferred tax liabilities		(948,980	)		(1,044,151	)
Total noncurrent deferred tax assets, net	$	5,851,904		$	6,350,830

Effective Income Tax Rate Reconciliation

The following are reconciliations between expected income taxes, computed at the applicable statutory federal income tax rate applied to pretax accounting income, and the income tax net (expense) benefit for the periods presented:

	Year Ended June 30,
	2022			2021
Anticipated income tax expense at the statutory rate	$	(607,414	)	$	(1,360,452	)
State income tax expense, net of federal tax effect		(36,928	)		(84,288	)
Income tax effect of uncertain tax positions		7,804			(1,468	)
Return to provision adjustments		405			(45	)
Stock-based compensation		131,898			38,197
PPP Loan forgiveness		-			202,729
Other changes in deferred income tax assets, net		(24,380	)		1,348
Decrease in valuation allowance		10,083			7,536,400
Income tax net (expense) benefit	$	(518,532	)	$	6,332,421