v2.3.0.15
Income Taxes
9 Months Ended
Sep. 30, 2011
Income Taxes [Abstract] 
Income Taxes

NOTE 10—INCOME TAXES

Income Taxes:

The components of the provision for income taxes are as follows:

 

     Nine months ended  
     September 30, 2011  

Current income tax expense/(benefit)

    $ 113,353   

Deferred income tax expense

      185,356   
  

 

 

  

Total income tax expense

    $ 298,709   
  

 

 

  

The items accounting for the difference between income taxes computed at the federal statutory rate and the provision for income taxes are as follows:

 

     Nine months ended  
     September 30, 2011  
           Impact on  
     Amount     Rate  

Income tax expense (benefit) at federal rate

    $ 386,861        34.00 % 
  

 

 

    

 

 

  

State tax, net of Federal effect

      48,085        4.23 % 
  

 

 

    

 

 

  

Permanent Differences:

     

Meals and entertainment

      16,470        1.45 % 

Officer's life insurance

      1,003        0.09 % 

Derivative expense

      (153,709 )      -13.51 % 
  

 

 

    

 

 

  

Total permanent differences

    $ (136,236 )      -11.97 % 
  

 

 

    

 

 

  

Rounding

    $ (1 )      0.00 % 
  

 

 

    

 

 

  

Total income tax expense/(benefit)

    $ 298,709        26.26 % 
  

 

 

    

 

 

  

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's net deferred income taxes are as follows:

 

     September 30, 2011  

Current Deferred Tax Assets:

   

Warranty reserve

    $ 472,091   

Repurchase reserve

      49,885   

Loan loss reserve

      55,454   

Accrued legal fees

      1,911   

Allowance for doubtful accounts

      11,468   
  

 

 

  

Total Current Deferred Tax Asset

    $ 590,809   
  

 

 

  

Non-Current Deferred Tax Assets:

   

Goodwill impairment

      2,254,767   

Valuation allowance

      (402,620 ) 
  

 

 

  

Total Non-Current Deferred Tax Assets

    $ 1,852,147   
  

 

 

  

Non-Current Deferred Tax Liability:

   

Accelerated depreciation

    $ (59,015 ) 

Sale of assets

      (341 ) 
  

 

 

  

Total Non-Current Deferred Tax Liability

    $ (59,356 ) 
  

 

 

  

Total Deferred Tax Assets (Liabilities)—Net

    $ 2,383,600