E. INCOME TAXES

12 Months Ended

Jun. 24, 2018

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE E - INCOME TAXES:

Provision for income taxes from continuing operations consists of the following (in thousands):

	Fiscal Year Ended
	June 24,			June 25,
	2018			2017
Current - Federal	$	(33	)	$	—
Current - Foreign		51			—
Current - State		30			53
Deferred - Federal		—			—
Deferred - State		—			—
Provision for income taxes	$	48		$	53

Included in loss from discontinued operations is $60 thousand and $0 of tax benefit for the fiscal years ended June 24, 2018 and June 25, 2017, respectively.

The effective income tax rate varied from the statutory rate for the fiscal years ended June 24, 2018 and June 25, 2017 as reflected below (in thousands):

	June 24,			June 25,
	2018			2017
Federal income taxes blended statutory rate of 27.64% of pre-tax loss	$	(291	)	$(4,119)
State income tax, net of federal effect		51		35
Foreign taxes		30		-
Permanent adjustments		35		24
Rate change		3,416		-
Valuation allowance		(6,597	)	4,019
Other		34		94
	$	(3,322	)	$53

The tax effects of temporary differences that give rise to the net deferred tax assets consisted of the following (in thousands):

		June 24,			June 25,
	2018			2017
Current
Reserve for bad debt	$	36		$	89
Deferred fees		15			27
Other reserves and accruals		562			1,323
		613			1,439
Non Current
Credit carryforwards		153			199
Net operating loss carryforwards		5,122			4,799
Depreciable assets		17			2,585
Total gross deferred tax asset		5,905			9,022
Valuation allowance		(2,426	)		(9,022	)
Net deferred tax asset	$	3,479		$	—

At the end of tax year ended June 24, 2018, the Company had net operating loss carryforwards totaling $23.5 million that are available to reduce future taxable income and will begin to expire in 2032.