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Income Taxes (Tables) | 12 Months Ended
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Jul. 02, 2023
Income Tax Disclosure [Abstract] |
Provision (Benefit) for Income Taxes | The provision for income taxes consisted of the following (thousands of dollars):
|  | Years Ended |
|  | July 2, 2023 |  |  | July 3, 2022 |
Currently payable (recoverable): |  |  |  |  |  |
Federal |  | $ | 1,035 |  |  | $ | (691 | )
State |  |  | 401 |  |  |  | 161 |
Foreign |  |  | 4,782 |  |  |  | 2,931 |
|  |  | 6,218 |  |  |  | 2,401 |
Deferred tax provision |  |  | (4,937 | ) |  |  | (1,986 | )
|  | $ | 1,281 |  |  | $ | 415 |
Difference Between Income Taxes Computed at the Federal Statutory Tax Rate and the Provision for Income Taxes | The items accounting for the difference between income taxes computed at the Federal statutory tax rate and the provision for income taxes were as follows:
|  | Years Ended |
|  | July 2, 2023 |  |  | July 3, 2022 |
U.S. statutory rate |  |  | 21.0 | % |  |  | 21.0 | %
State taxes, net of Federal tax benefit |  |  | 4.7 |  |  |  | 0.4 |
Foreign subsidiaries |  |  | — |  |  |  | 8.4 |
China non-resident capital gain tax |  |  | (28.7 | ) |  |  | — |
U.S. tax impact on sale of VAST LLC |  |  | (9.7 | ) |  |  | — |
Valuation allowance |  |  | (18.8 | ) |  |  | — |
Return to provision adjustment |  |  | 2.1 |  |  |  | (11.1 | )
Global intangible low-taxed income |  |  | (8.0 | ) |  |  | 0.5 |
Research and development tax credit |  |  | 19.4 |  |  |  | (9.7 | )
Solar investment tax credit |  |  | — |  |  |  | (0.8 | )
Non-controlling interest |  |  | 4.0 |  |  |  | (1.8 | )
Uncertain tax positions |  |  | (1.7 | ) |  |  | (1.4 | )
Stock based compensation |  |  | 0.3 |  |  |  | (1.3 | )
Other |  |  | (1.3 | ) |  |  | 0.3 |
|  |  | (16.7 | %) |  |  | 4.5 | %
Components of Deferred Tax (Liabilities) Assets | The components of deferred tax (liabilities) assets were as follows (thousands of dollars):
|  | July 2, 2023 |  |  | July 3, 2022 |
Unrecognized pension and postretirement benefit plan liabilities |  | $ | 368 |  |  | $ | 579 |
Accrued warranty |  |  | 2,255 |  |  |  | 423 |
Payroll-related accruals |  |  | 4,094 |  |  |  | 3,085 |
Research and development costs |  |  | 5,541 |  |  |  | — |
Capital loss carryforward related to sale of interest in VAST LLC |  |  | 1,403 |  |  |  | — |
Stock-based compensation |  |  | 414 |  |  |  | 360 |
Inventory reserve |  |  | 1,633 |  |  |  | 1,010 |
Environmental reserve |  |  | 327 |  |  |  | 327 |
Repair and maintenance supply parts reserve |  |  | 222 |  |  |  | 222 |
Allowance for doubtful accounts |  |  | 118 |  |  |  | 118 |
Lease Liability |  |  | 1,049 |  |  |  | 710 |
Right of Use Assets |  |  | (1,049 | ) |  |  | (710 | )
Credit carry-forwards |  |  | 1,628 |  |  |  | 2,986 |
Postretirement obligations |  |  | 64 |  |  |  | 8 |
Accumulated depreciation |  |  | (4,387 | ) |  |  | (3,886 | )
Accrued pension obligations |  |  | 415 |  |  |  | 504 |
Joint ventures |  |  | 47 |  |  |  | 899 |
Other |  |  | 1,078 |  |  |  | 604 |
|  |  | 15,220 |  |  |  | 7,239 |
Valuation allowance |  |  | (1,601 | ) |  |  | (158 | )
Net deferred tax assets |  | $ | 13,619 |  |  | $ | 7,081 |
Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the years ended July 2, 2023 and July 3, 2022 (thousands of dollars):
|  | Years Ended |
|  | July 2, 2023 |  |  | July 3, 2022 |
Unrecognized tax benefits, beginning of year |  | $ | 1,314 |  |  | $ | 1,458 |
Gross increases – tax positions in prior years |  |  | 50 |  |  |  | 13 |
Gross decreases – tax positions in prior years |  |  | — |  |  |  | (19 | )
Gross increases – current period tax positions |  |  | 385 |  |  |  | 241 |
Tax years closed |  |  | (354 | ) |  |  | (379 | )
Unrecognized tax benefits, end of year |  | $ | 1,395 |  |  | $ | 1,314 |

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