3.	INCOME TAXES:

Deferred taxes are determined based on the estimated future tax effects of differences between the financial statements and tax basis of assets and liabilities given the provision of the enacted tax laws. Significant components of the Company's deferred tax liabilities and assets as of April 30, 2016 and 2015 are as follows (in thousands):

	April 30, 2016		April 30, 2015
Deferred tax liabilities:
Depreciation	$	-	$	(178)

Deferred tax assets:
Depreciation		80		-
Accounts receivable allowance		31		28
Inventory and other allowances		859		1,154
Vacation accruals		93		117
NOL carryforward		41		76
Total gross deferred tax assets		1,104		1,375
Less valuation allowance		-		-
Net deferred tax assets	$	1,104	$	1,197

The reconciliation of the federal statutory income tax rate to the effective tax rate is as follows:

	April 30, 2016		April 30, 2015
Statutory federal income tax rate (benefit) expense, net of noncontrolling interest		34.00%		34.00%
State income tax net of federal benefits		0.00%		0.00%
Permanent tax		30.70%		59.15%
Other		14.75%		(9.71)%
		79.45%		83.44%

Income tax expense:
Deferred income tax	$	93	$	138
Current income tax		-		-
Total income tax expense	$	93	$	138

Current income tax expense (benefit) of $0 and $0 are comprised of $0 and $0 in federal income tax and $0 and $0 in state income tax for the years ended April 30, 2016 and 2015, respectively.

The Company has accrued (refundable) income taxes due to federal and state taxing authorities of $0 and $0 for the years ended April 30, 2016 and 2015, respectively.

The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on its financial condition, results of operations or cashflow. Therefore, no reserve for uncertain income tax position, interest or penalties, have been recorded.

The Company files income tax returns in the U.S. Federal jurisdiction and various state jurisdictions. The Company is no longer subject to U.S. Federal tax examinations for tax years beginning on May 1, 2011 and prior. There are no current tax examinations.