10.           Income Taxes

We recorded income tax expense of $278,000 in the fiscal 2012 first quarter compared to $644,000 for the same period last fiscal year.  The effective income tax rate for each quarter was 34.7% and 37.5% respectively.  The 2.8% reduction in the effective tax rate can be attributed to an increase in the additional tax deduction for contributions of appreciated property (1.8% benefit) and receipt of a distribution from our former captive insurance arrangement that was treated as income on the books, but as a return of capital for tax purposes (0.8% benefit).