10.

Income Taxes

The income tax provisions are comprised of the following:

	Dec. 31 2014		Dec. 31 2013
Current:
Federal	$	-	$	-
State		94,371		43,751
Foreign		578,798		92,643
	$	673,169	$	136,394

Deferred
Federal	$	(550,089)	$	(62,192)
State		-		-
Foreign		66,887		195,634
		(483,202)		133,442
Total Income Tax Provision	$	189,967	$	269,836

The components of the net deferred tax asset at December 31 are as follows:

	2012		2013
Deferred tax assets:
Allowance for doubtful accounts	$	69,898	$	54,352
Inventory allowances		246,425		283,193
Accrued liabilities		282,055		200,395
Unicap 263A adjustment		157,240		186,611
Net operating loss carryforwards		685,322		690,846
Alternative minimum tax credit carryforwards		398,162		398,162
State investment tax credit carryforward		10,912		76,668
Foreign tax credit carryforward		696,509		615,080
Other foreign tax items		50,747		-
Foreign net operating loss carryforwards		466,053		461,965
Total deferred tax assets		3,063,323		2,967,272
Deferred tax liabilities:
Tax over book basis of capital assets		(1,083,852)		(1,354,409)
Undistributed Earnings from Subsidiaries		(247,385)		(211,274)
Other foreign tax items		-		(152,705)
Net deferred tax assets	$	1,732,086	$	1,248,884

The Company has net operating loss carryforwards of approximately $2,270,000 expiring in various years through 2025. In addition, the Company has approximately $398,000 of alternative minimum tax credits as of December 31, 2014, which have no expiration date.

Income tax provisions differed from the taxes calculated at the statutory federal tax rate as follows:

	Years Ended December 31,
	2014		2013
Taxes at statutory rate	$	183,344	$	230,474
State income taxes		27,583		42,502
Nondeductible expenses		59,129		40,565
Foreign taxes and other		(80,089)		(43,705)
Income tax provision	$	189,967	$	269,836

The Company files tax returns in the U.S., and in the U.K, Germany and Mexico foreign tax jurisdictions and also in various state jurisdictions in the U.S. The tax years 2011 through 2014 remain open to examination. Our policy is to recognize interest and penalties related to uncertain tax positions in income tax expense. During the twelve months ended December 31, 2014 and 2013, the Company did not recognize expense for interest or penalties, and do not have any amounts accrued at December 31, 2014 and 2013, as the Company does not believe it has taken any uncertain tax positions.