Note 4 - Contract Receivables, Contract Assets and Contract Liabilities

3 Months Ended

Feb. 28, 2023

Notes to Financial Statements

Contract Receivable, Contract Assets, and Contract Liabilities [Text Block]

4) Contract Receivables, Contract Assets and Contract Liabilities

The following table provides information about contract receivables, contract assets, and contract liabilities from contracts with customers included on the Condensed Consolidated Balance Sheets.

	February 28, 2023		November 30, 2022
Receivables	$	3,666,000	$	2,722,000
Assets		98,000		451,000
Liabilities		3,474,000		1,157,000

The amount of revenue recognized in the first three months of fiscal 2023 that was included in a contract liability on November 30, 2022 was approximately $827,000 compared to $415,000 in the same period of fiscal 2022. The beginning contract receivables, assets and liabilities on December 1, 2021 were approximately $2,663,000; $177,000 and $559,000, respectively. The increase in contract receivables on February 28, 2023 is due to a 40.7% increase in revenue for Q1 of fiscal 2023 and the timing of contract billings that were outstanding at quarter end. Contract liabilities increased significantly during the three months ended February 28, 2022 as the Company received a large number of deposits from our fall early order program. The Company incentivizes cash deposits in exchange for discounts to lock in inventory pricing and help with planning to maximize plant efficiency in the agricultural products segment.

The Company utilizes the practical expedient exception for these contracts and will report only on performance obligations greater than one year. As of February 28, 2023, the Company has no performance obligations with an original expected duration greater than one year.