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Note 4 - Income Taxes:
 12 Months Ended
Oct. 28, 2011
Income Tax Disclosure [Text Block]
NOTE 4- Income Taxes:

The provision for taxes on income includes the following:

   
2011
   
2010
 
Current:
           
Federal
 
$
(603
)
 
$
749
 
State
   
(66
)
   
455
 
     
(669
)
   
1,204
 
                 
Deferred:
               
Federal
      -         -  
State
      -         -  
                 
   
$
(669
)
 
$
1,204
 

The total tax provision differs from the amount computed by applying the statutory federal income tax rate to income before income taxes as follows:

   
2011
   
2010
 
Provision for federal income taxes at the applicable statutory rate
 
$
(378
)
 
$
1,878
 
Increase in provision resulting from state income taxes, net of federal income tax benefit
   
(98
)
   
65
 
Research & development tax credit
    -      
(4
)
Non-taxable life insurance gain
   
(163
)
   
(190
)
Benefits of tax law changes - state     (114 )      -  
Change in valuation allowance
   
(4
)     
(595
)
Other, net
   
88
     
50
 
   
$
(669
)
 
$
1,204
 

Deferred income taxes result from differences in the bases of assets and liabilities for tax and accounting purposes.

   
2011
   
2010
 
Receivables allowance
 
$
53
   
$
34
 
Returns allowance
   
180
     
217
 
Inventory packaging reserve
   
76
     
61
 
Inventory capitalization
   
254
     
333
 
Incentive compensation
   
361
     
275
 
State taxes
   
16
     
143
 
Employee benefits
   
1,483
     
1,371
 
Other
   
9
     
44
 
Valuation allowance
   
(2,432
)
   
(2,478
)
Current tax assets, net
 
$
-    
$
-  
                 
State taxes
 
$
282
   
$
280
 
Incentive compensation
   
290
     
609
 
Pension and health care benefits
   
7,789
     
4,705
 
Depreciation
   
(801
)
   
(210
)
Net operating loss carry-forward and credits
   
1,484
     
187
 
Valuation allowance
   
(9,044
)
   
(5,571
)
Non-current tax assets, net
 
$
-    
$
-  

Management is required to evaluate whether a valuation allowance should be established against its deferred tax assets based on the consideration of all available evidence using a "more likely than not" standard. Realization of deferred tax assets is dependent upon taxable income in prior carryback years, estimates of future taxable income, tax planning strategies, and reversals of existing taxable temporary differences.  Forming a conclusion that a valuation allowance is not needed is difficult when there is negative evidence such as cumulative losses in recent years or losses expected in early future years.  Management concluded at the end of 2008 that it was more likely than not that deferred tax assets would not be realized and recorded a full valuation allowance on all deferred tax assets during the fourth quarter of fiscal 2008.

Management reevaluated the need for a full valuation allowance at the end of 2011.  Management evaluated both positive and negative evidence.  The weight of negative factors and level of economic uncertainty in our current business continued to support the conclusion that the realization of our deferred tax assets does not meet the more likely than not standard.  Therefore, a full valuation allowance will remain against the net deferred tax assets.

As of October 28, 2011, the Company had federal and state net operating loss carryforwards of approximately $4,223 and $4,793 respectively.  These loss carryforwards will expire at various dates from 2012 through 2028.

In July 2006, the FASB issued guidance to clarify the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. This interpretation prescribed a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The guidance also discussed derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The cumulative effect, if any, of applying this guidance is to be reported as an adjustment to the opening balance of retained earnings in the year of adoption.  The provisions of this guidance have been incorporated into Accounting Standards Codification ("ASC") 740-10.

As of October 28, 2011, we have provided a liability of $105 for unrecognized tax benefits related to various federal and state income tax matters. This entire amount would reduce our effective income tax rate if the asset is recognized in future reporting periods.  We have not identified any new unrecognized tax benefits.

As of October 29, 2010, we have provided a liability of $95 for unrecognized tax benefits related to various federal and state income tax matters.  This entire amount would reduce our effective income tax rate if the asset is recognized in future reporting periods.  We have not identified any new unrecognized tax benefits.

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:

   
2011
   
2010
 
Balance at beginning of year
 
$
95
   
$
103
 
Additions based on tax positions related to the current year
   
-
     
-
 
Additions for tax positions of prior years
   
10
     
29
 
Reductions for tax positions of prior years
      -      
(2
)
Settlements
      -      
(35
)
                 
Balance at end of year
 
$
105
   
$
95
 

We recognize any future accrued interest and penalties related to unrecognized tax benefits in income tax expense.  As of October 28, 2011, we had approximately $2 in accrued interest and penalties which is included as a component of the $105 unrecognized tax benefit noted above.

During the year ended October 29, 2010, the Internal Revenue Service settled its audit of our U.S. federal income tax returns for November 1, 2002, October 31, 2003, November 3, 2006 and November 2, 2007. This settlement resulted in the reversal of $35 of unrecognized tax benefits associated with R&D credits we reported, which increased our tax expense by $5.  Our federal income tax returns are open to audit under the statute of limitations for the years ended October 31, 2008 through 2010. 

We are subject to income tax in California and various other state taxing jurisdictions. Our state income tax returns are open to audit under the statute of limitations for the fiscal years ended October 31, 2007 through 2010.

We do not anticipate a significant change to the total amount of unrecognized tax benefits within the next 12 months.