Note 2 - Change in Accounting Principle

9 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Accounting Standards Update and Change in Accounting Principle [Text Block]

2.

    CHANGE IN ACCOUNTING PRINCIPLE

During

the

first

quarter of fiscal

2020,

the Company changed its method of recording stock-based compensation expense.  Under the new accounting principle, stock-based compensation expense is recorded on a straight-line basis over the vesting period and forfeitures are recognized when they occur.  Under the previous method, the Company estimated future forfeitures and the expected number of awards that would vest and subsequently adjusted for forfeitures.  The Company believes this method of recording stock-based compensation expense on a straight-line basis over the vesting period is preferable since it is more reflective of the stock options that will actually vest.

The cumulative effect of the changes in the 

June 30, 2019

Consolidated Balance Sheet for the change in principle related to stock-based compensation expense using the full retrospective method was as follows:

			Stock-Based
Balance Sheet	As Previously		Compensation			As
June 30, 2019	Reported		Adjustment			Adjusted
Equity:
Paid in capital	$	6,186,393	$	146,742		$	6,333,135
Retained earnings	$	8,848,684	$	(146,742	)	$	8,701,942

The impact of the change in principle on the Consolidated Statement of Operations for the 

three

and

nine

months ended

March 31, 2019

 was as follows:

			Stock-Based
Statement of Operations	As Previously		Compensation			As
Three Months Ended March 31, 2019	Reported		Adjustment			Adjusted
Selling, general and administrative expenses	$	1,505,922	$	34,426		$	1,540,348
Income from operations		149,286		(34,426	)		114,860
Net income	$	172,306	$	(34,426	)	$	137,880
Income per common share
Basic	$	0.02	$	(0.00	)	$	0.02
Diluted	$	0.02	$	(0.00	)	$	0.02

			Stock-Based
Statement of Operations	As Previously		Compensation			As
Nine Months Ended March 31, 2019	Reported		Adjustment			Adjusted
Selling, general and administrative expenses	$	4,798,045	$	91,239		$	4,889,284
Income from operations		350,843		(91,239	)		259,604
Net income	$	373,838	$	(91,239	)	$	282,599
Income per common share
Basic	$	0.05	$	(0.01	)	$	0.04
Diluted	$	0.05	$	(0.01	)	$	0.04

The impact of the change in principle on the Consolidated Statement of Cash Flows for the

nine

months ended

March 31, 2019

 was as follows:

			Stock-Based
Statement of Cash Flows	As Previously		Compensation			As
Nine Months Ended March 31, 2019	Reported		Adjustment			Adjusted
Operating activities:
Net income	$	373,838	$	(91,239	)	$	282,599
Stock-based compensation expense	$	292,186	$	91,239		$	383,425

As of

March 31, 2020

, the unrecognized stock-based compensation expense, which is expected to be recognized over a weighted-average period of

3.03

years, was

$1,366,897.

  The unrecognized stock-based compensation expense was

$1,093,712

as of

June 30, 2019,

with an expected recognition weighted-average period of

3.01

years.