11. Income Taxes

12 Months Ended

Jun. 30, 2016

Income Tax Disclosure [Abstract]

11. Income Taxes

The reconciliation of the provision for income taxes at the federal statutory rate of 35% to the actual tax expense or benefit for the applicable fiscal year was as follows:

	2016						2015
	Amount			% of  Pre-tax  Income			Amount			% of  Pre-tax  Income
Computed “expected” income tax (benefit)	$	76,600			35.0	%	$	(2,600	)		(35.0	%)
Research and development credits		(15,700	)		(7.2	)		(11,200	)		(153.4	)
Other, net		(7,600	)		(3.5	)		(2,200	)		(30.7	)
Income tax expense (benefit)	$	53,300			24.3	%	$	(16,000	)		(219.1	%)

Deferred tax assets and liabilities consist of the following:

	2016			2015
Deferred tax assets:
Amortization of intangible assets	$	287,000		$	183,000
Research and development credits		-			24,800
Various accruals		132,800			60,800
Other		48,900			46,100
		468,700			314,700
Deferred tax liability:
Depreciation of property and amortization of goodwill		(52,200	)		(46,000	)
Net deferred tax assets	$	416,500		$	268,700

The breakdown between current and long-term deferred tax assets and liabilities is as follows:

	2016			2015
Current deferred tax assets	$	140,600		$	114,200
Long-term deferred tax assets		328,100			200,500
Long-term deferred tax liabilities		(52,200	)		(46,000	)
Net long-term deferred tax assets		275,900			154,500
Net deferred tax assets	$	416,500		$	268,700

ASC No. 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC No. 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. As of June 30, 2016 and 2015, the Company did not have any unrecognized tax benefits related to various federal and state income tax matters.

The Company’s policy is to recognize interest and penalties on any unrecognized tax benefits as a component of income tax expense. The Company does not have any accrued interest or penalties associated with any unrecognized tax benefits. The Company is subject to U.S. federal income tax, as well as various state jurisdictions. The Company is currently open to audit under the statute of limitations by the federal and state jurisdictions for the years ending June 30, 2013 and after. The Company does not anticipate any material amount of unrecognized tax benefits within the next 12 months.