Note 7 - Segment Information

3 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

Note 7 – Segment Information

In accordance with FASB ASC 280, “Disclosures about Segments of an Enterprise and related information”, the Company determined it has two reportable segments - avionics government and avionics commercial. There are no inter-segment revenues.

The Company is organized primarily on the basis of its avionics products.  The avionics government segment consists primarily of the design, manufacture, and sale of test equipment to the U.S. and foreign governments and militaries either directly or through distributors.  The avionics commercial segment consists of design, manufacture, and sale of test equipment to domestic and foreign airlines, directly or through commercial distributors, and to general aviation repair and maintenance shops. The Company develops and designs test equipment for the avionics industry and as such, the Company’s products and designs cross segments.

Management evaluates the performance of its segments and allocates resources to them based on gross margin. The Company’s general and administrative costs and sales and marketing expenses, and engineering costs are not segment specific. As a result, all operating expenses are not managed on a segment basis.  Net interest includes expenses on debt and income earned on cash balances, both maintained at the corporate level. Segment assets include accounts receivable and work-in-process inventory. Asset information, other than accounts receivable and work-in-process inventory, is not reported, since the Company does not produce such information internally.  All long-lived assets are located in the U.S.

The table below presents information about reportable segments within the avionics business for the three month periods ending June 30, 2015 and 2014:

Three Months Ended  June 30, 2015	Avionics  Government		Avionics  Commercial		Avionics  Total		Corporate  Items			Total
Net sales	$	5,261,319	$	584,600	$	5,845,919		-		$	5,845,919
Cost of sales		3,561,594		469,030		4,030,624		-			4,030,624
Gross margin		1,699,725		115,570		1,815,295		-			1,815,295
Engineering, research, and development						492,132		-			492,132
Selling, general and administrative						360,629		505,059			865,688
Amortization of deferred financing costs						-		1,357			1,357
Change in fair value of common stock warrants						-		(67,760	)		(67,760	)
Interest expense, net						-		29,634			29,634
Total expenses						852,761		468,290			1,321,051
Income (loss) before income taxes					$	962,534	$	(468,290	)	$	494,244

Three Months Ended  June 30, 2014	Avionics Government		Avionics Commercial		Avionics Total		Corporate Items			Total
Net sales	$	2,520,723	$	608,353	$	3,129,076		-		$	3,129,076
Cost of sales		1,514,415		494,444		2,008,859		-			2,008,859
Gross margin		1,006,308		113,909		1,120,217		-			1,120,217
Engineering, research, and development						483,896		-			483,896
Selling, general, and administrative						292,383		586,810			879,193
Amortization of debt discount						-		30,874			30,874
Amortization of deferred financing costs						-		27,080			27,080
Change in fair value of common stock warrants						-		133,881			133,881
Interest (income) expense, net						-		62,480			62,480
Total expenses						776,279		841,125			1,617,404
Income (loss) before income taxes					$	343,938	$	(841,125	)	$	(497,187	)