| Schedule of deferred tax assets |
| |
|
2017 |
|
|
2016 |
|
| Deferred tax assets: |
|
|
|
|
|
|
|
|
| Net operating loss carryforwards |
|
$ |
3,593,000 |
|
|
$ |
5,061,830 |
|
| Business credit carryforwards |
|
|
100,000 |
|
|
|
80,551 |
|
| Bad debt expense |
|
|
56,000 |
|
|
|
39,834 |
|
| Intangible assets |
|
|
1,113,000 |
|
|
|
1,742,639 |
|
| Stock-based compensation |
|
|
575,000 |
|
|
|
579,970 |
|
| Unrealized capital loss |
|
|
12,000 |
|
|
|
16,870 |
|
| Inventory reserve |
|
|
997,000 |
|
|
|
1,419,084 |
|
| Deferred rent |
|
|
299,000 |
|
|
|
– |
|
| Other |
|
|
59,000 |
|
|
|
44,410 |
|
| |
|
|
6,804,000 |
|
|
|
8,985,188 |
|
| Deferred tax liabilities: |
|
|
|
|
|
|
|
|
| Property and equipment |
|
|
(331,000 |
) |
|
|
(18,052 |
) |
| CanX intangible assets |
|
|
(1,074,000 |
) |
|
|
(1,556,300 |
) |
| |
|
|
(1,405,000 |
) |
|
|
(1,574,352 |
) |
| Valuation allowance |
|
|
(6,473,000 |
) |
|
|
(8,967,136 |
) |
| Net deferred tax liabilities |
|
$ |
(1,074,000 |
) |
|
$ |
(1,556,300 |
) |
|
| Reconciliation of income tax provision |
| |
|
|
|
|
|
|
| |
|
2017 |
|
|
2016 |
|
| |
|
|
|
|
|
|
| Income tax benefit at statutory rate |
|
$ |
(1,829,000 |
) |
|
$ |
(4,808,041 |
) |
| State taxes |
|
|
(37,000 |
) |
|
|
(732,064 |
) |
| Effect of change in future tax rate on deferred tax balances |
|
|
2,226,000 |
|
|
|
– |
|
| Stock-based compensation |
|
|
685,000 |
|
|
|
553,832 |
|
| Change in derivative liability |
|
|
(85,000 |
) |
|
|
180,430 |
|
| Amortization of discount on convertible note |
|
|
– |
|
|
|
(50,048 |
) |
| Non-deductible interest on convertible notes |
|
|
135,000 |
|
|
|
– |
|
| Royalty buyout |
|
|
827,000 |
|
|
|
– |
|
| Other permanent differences |
|
|
85,000 |
|
|
|
3,951 |
|
| Other |
|
|
5,500 |
|
|
|
– |
|
| Change in valuation allowance |
|
|
(2,494,000 |
) |
|
|
4,851,940 |
|
| Total provision |
|
$ |
(481,500 |
) |
|
$ |
– |
|
|