Note 13 - Income Taxes

12 Months Ended

Nov. 30, 2020

Notes to Financial Statements

Income Tax Disclosure [Text Block]

( 13 ) Income Taxes

Total income tax expense (benefit) for the

2020

and

2019

fiscal years consists of the following:

	November 30, 2020			November 30, 2019
Current expense (benefit)	$	25,168		$	4,392
Deferred expense (benefit)		(881,638	)		(353,626	)
Total income tax expense (benefit)	$	(856,470	)	$	(349,234	)

The reconciliation of the statutory Federal income tax rate is as follows:

	November 30, 2020			November 30, 2019
Statutory federal income tax rate		21.0	%		21.0	%
PPP Loan Forgiveness		8.8			-
Permanent differences and other		(0.9	)		(1.3	)
		28.9	%		19.7	%

Tax effects of temporary differences that give rise to significant portions of the deferred tax assets (liabilities) at

November 30, 2020

and

2019

are presented as approximate amounts below:

	November 30
	2020			2019
Current deferred tax assets (liabilities):
Accrued expenses	$	161,000		$	100,000
Inventory capitalization		71,000			21,000
NOL and tax credit carryforward		1,695,000			1,182,000
Asset reserves		796,000			621,000
Total current deferred tax assets	$	2,723,000		$	1,924,000
Non-current deferred tax assets
Property, plant, and equipment	$	(55,000	)	$	(138,000	)
Total non-current deferred tax assets (liabilities)		(55,000	)		(138,000	)
Net deferred taxes	$	2,668,000		$	1,786,000

In assessing the realizability of deferred tax assets, management considers whether it is more likely than

not

that some portion or all of the deferred tax assets will

not

be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company's net operating loss amounting to approximately

$7,479,000

and tax credit carryforward amounting to approximately

$109,000

for its U.S. operations expire on

November 30, 2036,

2037,

2038,

2039

and

2040.

Management believes that the Company will be able to utilize the U.S. net operating losses and credits before their expiration.