Income Taxes
 12 Months Ended
Apr. 30, 2020
Income Tax Disclosure [Abstract]  
Income Taxes

NOTE 14 – INCOME TAXES

 

The Company is an emerging growth company and, prior to its fiscal quarter ended October 31, 2018, had not generated earnings from its operations or pre-tax earnings. During its fiscal year ended April 30, 2018 and 2019, the Company had a consolidated operating loss of $6.0 million and $1.0 million, respectively. During the fiscal year ended April 30, 2020, the Company’s consolidated operating earnings were $9.7 million. The Company believes that it is probable it will utilize its available net operating losses entirely in the foreseeable future. During the fiscal year ended April 30, 2020, the Company recognized a current provision for income taxes of $2.1 million and a deferred income tax benefit of $1.6 million. Prior to the fiscal year ended April 30, 2020, the Company had not recognized a provision for (benefit from) income taxes.

 

In December 2017, the U.S. enacted comprehensive amendments to the Internal Revenue Code of 1986 (“U.S. Tax Reform of 2017”). Among other things, U.S. Tax Reform of 2017 reduced the federal statutory tax rate for corporate taxpayers to 21% and otherwise modified corporate tax rules in significant ways. The U.S. Tax Reform of 2017 did not otherwise have a material impact on the Company’s financial statements.

 

For the fiscal year ended April 30, 2020, our income tax rate reconciliation is as follows:

 

Federal statutory rate     21.0 %
State income taxes and franchise tax     3.5 %
Net operating loss utilization and other     (9.7 )%
Effective tax rate     14.8 %

 

For the fiscal year ended April 30, 2020, our consolidated provision for (benefit from) income taxes is as follows:

 

Current:        
Federal   $ 2,020,305  
State     113,714  
Total current     2,134,019  
Deferred:        
Federal     (1,649,018 )
State     -  
Total deferred     (1,649,018 )
Total consolidated income tax provision   $ 485,001  

 

As of April 30, 2020, our deferred tax asset (liability) is as follows:

 

Gross deferred tax asset:      
Share-based compensation   $ 1,098,622  
Accruals and reserves not currently deductible     550,396  
Total deferred tax asset     1,649,018  
Total deferred tax liability     -  
Total consolidated deferred tax asset   $ 1,649,018