Electromed (ELMD) 10-K 25 Sep 18 2018 FY Annual report Financial data

Document And Entity Information

Document And Entity Information - USD ($)	12 Months Ended
	Jun. 30, 2018	Sep. 21, 2018	Dec. 31, 2017
Document And Entity Information [Abstract]
Entity Registrant Name	Electromed, Inc.
Entity Central Index Key	1,488,917
Document Type	10-K
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Entity's Reporting Status Current	Yes
Entity a Voluntary Filer	No
Entity Well-known seasoned issuer	No
Current Fiscal Year End Date	--06-30
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		8,329,826
Entity Public Float			$ 41,152,000
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2,018

Balance Sheets

Balance Sheets - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Current Assets
Cash	$ 7,455,844	$ 5,573,709
Accounts receivable (net of allowances for doubtful accounts of $45,000)	11,563,208	9,949,759
Inventories	2,360,693	2,559,485
Prepaid expenses and other current assets	832,202	393,319
Total current assets	22,211,947	18,476,272
Property and equipment, net	3,091,242	3,303,233
Finite-life intangible assets, net	649,103	721,276
Other assets	91,912	99,868
Deferred income taxes	594,000	460,000
Total assets	26,638,204	23,060,649
Current Liabilities
Current maturities of long-term debt	1,101,043	50,703
Accounts payable	810,644	663,376
Accrued compensation	1,209,738	946,623
Income tax payable	397,390	156,524
Warranty reserve	760,000	640,000
Other accrued liabilities	464,357	438,748
Total current liabilities	4,743,172	2,895,974
Long-term debt, less current maturities and net of debt issuance costs		1,097,125
Total liabilities	4,743,172	3,993,099
Shareholders' Equity
Common stock, $0.01 par value; authorized: 13,000,000 shares; 8,288,659 and 8,230,167 issued and outstanding at June 30, 2018 and June 30, 2017, respectively	82,887	82,302
Additional paid-in capital	14,953,103	14,028,602
Retained earnings	6,859,042	4,956,646
Total shareholders' equity	21,895,032	19,067,550
Total liabilities and shareholders' equity	$ 26,638,204	$ 23,060,649

Balance Sheets (Parenthetical)

Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Statement of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 45,000	$ 45,000
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	13,000,000	13,000,000
Common stock, shares issued	8,288,659	8,230,167
Common stock, shares outstanding	8,288,659	8,230,167

Statements of Operations

Statements of Operations - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Net revenues	$ 28,697,622	$ 25,861,144
Cost of revenues	5,841,601	5,292,715
Gross profit	22,856,021	20,568,429
Operating expenses
Selling, general and administrative	19,596,053	16,402,214
Research and development	251,443	596,876
Total operating expenses	19,847,496	16,999,090
Operating income	3,008,525	3,569,339
Interest income (expense), net	19,871	(49,867)
Net income before income taxes	3,028,396	3,519,472
Income tax expense	1,126,000	1,290,000
Net income	$ 1,902,396	$ 2,229,472
Income per share:
Basic	$ 0.23	$ 0.27
Diluted	$ 0.22	$ 0.26
Weighted-average common shares outstanding:
Basic	8,207,365	8,168,152
Diluted	8,620,102	8,461,120

Statements of Shareholders' Equ

Statements of Shareholders' Equity - USD ($)	Common Stock	Additional Paid-in Capital	Retained Earnings	Total
Balance at Jun. 30, 2016	$ 81,871	$ 13,549,551	$ 2,727,174	$ 16,358,596
Balance, shares at Jun. 30, 2016	8,187,112			8,187,112
Net income			2,229,472	$ 2,229,472
Issuance of restricted stock	$ 431	(431)
Issuance of restricted stock, shares	43,055
Share-based compensation expense		479,482		479,482
Balance at Jun. 30, 2017	$ 82,302	14,028,602	4,956,646	$ 19,067,550
Balance, shares at Jun. 30, 2017	8,230,167			8,230,167
Net income			1,902,396	$ 1,902,396
Issuance of restricted stock	$ 400	(400)
Issuance of restricted stock, shares	40,000
Issuance of common stock upon exercise of options	$ 185	62,227		62,412
Issuance of common stock upon exercise of options, shares	18,492
Share-based compensation expense		862,674		862,674
Balance at Jun. 30, 2018	$ 82,887	$ 14,953,103	$ 6,859,042	$ 21,895,032
Balance, shares at Jun. 30, 2018	8,288,659			8,288,659

Statements of Cash Flows

Statements of Cash Flows - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash Flows From Operating Activities
Net income	$ 1,902,396	$ 2,229,472
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	676,426	636,709
Amortization of finite-life intangible assets	113,601	118,418
Amortization of debt issuance costs	6,351	13,067
Share-based compensation expense	862,674	479,482
Deferred income taxes	(134,000)	(117,000)
Loss on disposal of property and equipment	25,990	3,302
Loss on disposal of intangible assets	4,122	132,724
Changes in operating assets and liabilities:
Accounts receivable	(1,613,449)	(2,338,322)
Inventories	234,594	(28,334)
Prepaid expenses and other assets	(433,363)	49,864
Income tax receivable		192,685
Income tax payable	240,866	156,524
Accounts payable and accrued liabilities	555,992	(337,470)
Net cash provided by operating activities	2,442,200	1,191,121
Cash Flows From Investing Activities
Expenditures for property and equipment	(526,227)	(618,763)
Expenditures for finite-life intangible assets	(45,550)	(68,385)
Net cash used in investing activities	(571,777)	(687,148)
Cash Flows From Financing Activities
Principal payments on long-term debt including capital lease obligations	(50,700)	(48,747)
Issuance of common stock upon exercise of options	62,412
Payment of deferred financing fees		(4,872)
Net cash provided by (used in) financing activities	11,712	(53,619)
Net increase in cash	1,882,135	450,354
Cash
Beginning of period	5,573,709	5,123,355
End of period	7,455,844	5,573,709
Supplemental Disclosures of Cash Flow Information
Cash paid for interest	46,002	59,233
Cash paid for income taxes	$ 1,019,134	$ 1,089,791

Nature of Business and Summary

Nature of Business and Summary of Significant Accounting Policies	12 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Nature of Business and Summary of Significant Accounting Policies	Note 1. Nature of Business and Summary of Significant Accounting Policies Nature of business: A summary of the Company’s significant accounting policies follows: Use of estimates: Revenue recognition: Direct patient sales are recorded at amounts to be received from patients under reimbursement arrangements with third-party payers, including private insurers, prepaid health plans, Medicare and Medicaid. In addition, the Company records an estimate for selling price adjustments that often arise from changes in a patient’s insurance coverage, changes in a patient’s domicile, insurance company coverage limitations or patient death. Other than the installment sales as discussed below, the Company expects to receive payment on the vast majority of accounts receivable within one year and therefore has classified all accounts receivable as current. However, in some instances, payment for direct patient sales can be delayed or interrupted, resulting in a portion of collections occurring later than one year. During fiscal 2017, the Company entered into a settlement agreement with the Centers for Medicare and Medicaid Services with respect to approximately 700 Medicare fee-for-service claims submitted between calendar years 2012 through 2015, resulting in approximately $703,000 of net recognized revenue. Certain third-party reimbursement agencies pay the Company on a monthly installment basis, which can span over several years. Due to the length of time over which cash is collected and the inherent uncertainty of collectability with these installment sales, the Company cannot make a reasonable estimate of revenue at the time of sale and does not record accounts receivable or revenue at the time of product shipment. Under the installment method, the Company defers the revenue associated with the sale and, as each installment is received, that amount is recognized as revenue. Deferred costs associated with the sale are amortized to cost of revenue ratably over the estimated period in which collections are scheduled to occur. Sales made under the installment method were approximately as follows: Years Ended June 30, 2018 2017 Revenue recognized under installment sales $ 1,202,000 $ 1,246,000 Amortized cost of revenues recognized 114,000 161,000 Unrecognized installment method sales were approximately as follows: June 30, 2018 2017 Estimated unrecognized sales, net of discounts $ 1,443,000 $ 1,814,000 Unamortized costs of revenues included in prepaid and other current assets and other assets 169,000 209,000 Shipping and handling expense: Cash: Accounts receivable: Inventories: Property and equipment: Finite-life intangible assets: Long-lived assets: If the Company believes the carrying value is unrecoverable, it would recognize an impairment charge necessary to reduce the unamortized balance to the estimated fair value of the asset or asset group. The amount of such impairment would be charged to operations in the current period. Warranty liability: Changes in the Company’s warranty liability were approximately as follows: Years Ended June 30, 2018 2017 Beginning warranty reserve $ 640,000 $ 660,000 Accrual for products sold 273,000 129,000 Expenditures and costs incurred for warranty claims (153,000 ) (149,000 ) Ending warranty reserve $ 760,000 $ 640,000 Income taxes: The Company recognizes tax liabilities when the Company believes that certain positions may not be fully sustained upon review by tax authorities. Benefits from tax positions are measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon settlement. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences impact income tax expense in the period in which such determination is made. Interest and penalties, if any, related to accrued liabilities for potential tax assessments are included in income tax expense. Research and development: Advertising costs: Share-based payments: Fair value of financial instruments: Basic and diluted earnings per share: New Accounting Pronouncements: The Company has substantially completed its assessment of our systems, available data and processes that will be affected by the implementation of this new revenue recognition guidance. As a result of the implementation of this standard, the Company expects to record an adjustment to increase retained earnings as of July 1, 2017 to reflect the cumulative effect of adoption of the new standard. At this time, the Company estimates this increase to be approximately $0.8 million. This adjustment reflects the acceleration of $1.4 million in revenues, partially offset by $0.4 million in deferred taxes, $0.1 million in costs of revenues and $0.1 million in selling, general and administrative costs. The July 1, 2017 balance sheet will include an increase of $1.4 million in accounts receivable, a $0.1 million increase in inventory, a $0.1 million decrease in other current assets, a $0.1 million decrease in other long-term assets, a $0.4 million decrease in deferred income taxes, a $0.1 million increase in accrued compensation and a $0.8 million increase in retained earnings. In addition, the Company will record an adjustment to restate fiscal 2018 to comparative operating results under the new guidance in its quarterly and annual financial statements during the fiscal year ending June 30, 2019, which will include additional required disclosures. The adjustment will result in a decrease in revenues of approximately $0.4 million and a decrease in currently reported net income of approximately $0.1 million for fiscal 2018. The adjustments to retained earnings as of July 1, 2017 and to restate operating results for its fiscal 2018 comparative annual period were primarily driven by changes in our accounting for sales that are: ● subject to reimbursement from certain third-party agencies on a monthly installment basis. Previously, the Company deferred revenue at the time of sale and, as each installment became billable and other criteria was met, revenue was recognized. ● subject to reimbursement under contracts where coverage is unconfirmed, payments are in appeal or are due from the patient, and where variable consideration is estimable. Previously, the Company fully deferred revenue at the time of sale until fixed and determinable. Under the new guidance, the Company will estimate variable consideration in the transaction price at contract inception based on historical experience and other relevant factors and recognize revenue at the time of sale. In July 2015, FASB issued ASU 2015-11, “Inventory (Topic 330) Related to Simplifying the Measurement of Inventory,” which applies to all inventory except that which is measured using last-in, first-out (“LIFO”) or the retail inventory method. Inventory measured using first-in, first-out (“FIFO”) or average cost is within the scope of the new guidance and should be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The new guidance is applied prospectively, and earlier application is permitted as of the beginning of an interim or annual reporting period. The Company adopted ASU 2015-11 effective July 1, 2017, which had no material impact on its financial statements or financial statement disclosures. In February 2016, FASB issued ASU 2016-02, “Leases.” This standard requires the recognition of all lease transactions with terms in excess of 12 months on the balance sheet as a lease liability and a right-of-use asset (as defined in the standard). ASU 2016-02 will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with earlier application permitted. Upon adoption, the lessee will apply the new standard retrospectively to all periods presented or retrospectively using a cumulative effect adjustment in the year of adoption. ASU 2016-02 is not expected to have a material impact on the Company’s financial statements or financial statement disclosures upon adoption based on current facts and circumstances. In March 2016, FASB issued ASU 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,” which reduces complexity in accounting standards related to share-based payment transactions, including, among others, (1) accounting for income taxes, (2) classification of excess tax benefits on the statement of cash flow, (3) forfeitures, and (4) statutory tax withholding requirements. ASU 2016-09 is effective for annual reporting periods beginning on or after December 15, 2016, and interim periods within those annual periods. The Company adopted ASU 2016-09 effective July 1, 2017, which had no material impact on its previously reported financial statements included in the Company’s Annual Report on Form 10-K for fiscal 2017. The Company has elected to continue to recognize estimated forfeitures as stock-based compensation expense.

Inventories

Inventories	12 Months Ended
	Jun. 30, 2018
Inventory Disclosure [Abstract]
Inventories	Note 2. Inventories The components of inventories at June 30, 2018 and 2017 were approximately as follows: June 30, 2018 2017 Parts inventory $ 1,388,000 $ 1,789,000 Work in process 621,000 205,000 Finished goods 632,000 745,000 Less: Reserve for obsolescence (280,000 ) (180,000 ) Total $ 2,361,000 $ 2,559,000

Property and Equipment

Property and Equipment	12 Months Ended
	Jun. 30, 2018
Property, Plant and Equipment [Abstract]
Property and Equipment	Note 3. Property and Equipment Property and equipment, including assets under capital leases, were approximately as follows: Estimated Useful June 30, 2018 2017 Building and building improvements 15-39 $ 2,263,000 $ 2,236,000 Land N/A 200,000 200,000 Land improvements 15 166,000 166,000 Equipment 3-7 3,131,000 2,982,000 Demonstration and rental equipment 3 1,071,000 959,000 6,831,000 6,543,000 Less: Accumulated depreciation (3,740,000 ) (3,240,000 ) Net property and equipment $ 3,091,000 $ 3,303,000 During fiscal 2018 and 2017, the Company impaired or disposed of certain property and equipment, no longer in use, with a net value of approximately $26,000 and $3,000, respectively, which was included as an expense in cost of goods sold or selling, general and administrative expense on the statements of operations.

Finite-life Intangible Assets

Finite-life Intangible Assets	12 Months Ended
	Jun. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Finite-life Intangible Assets	Note 4. Finite-life Intangible Assets The carrying value of patents and trademarks includes the original cost of obtaining the patents, periodic renewal fees, and other costs associated with maintaining and defending patent and trademark rights. Patents and trademarks are amortized over their estimated useful lives, generally 15 and 12 years, respectively. During fiscal 2018 and 2017, the Company abandoned certain domestic and foreign patents with a net value of approximately $4,000 and $133,000, respectively, which was included as an expense in selling, general and administrative expense on the statements of operations. The majority of the pending patents that were abandoned related to the initial development of the Company’s SQL SmartVest technology. During a review of the Company’s patent portfolio it was determined that certain patents proved redundant to a subsequent SQL patent filing and were therefore abandoned. A smaller portion of expense was related to patents that covered technology that management considered outdated and was no longer in use. Accumulated amortization was approximately $902,000 and $790,000 at June 30, 2018 and 2017, respectively. The activity and net balances of finite-life intangible assets were approximately as follows: Years Ended June 30, 2018 2017 Balance, beginning $ 721,000 $ 904,000 Additions 46,000 68,000 Abandonments (4,000 ) (133,000 ) Amortization expense (114,000 ) (118,000 ) Balance, ending $ 649,000 $ 721,000 Based on the carrying value as of June 30, 2018, future amortization is expected to be as follows: Fiscal years ending June 30: 2019 $ 114,000 2020 113,000 2021 113,000 2022 79,000 2023 17,000 Thereafter 213,000 Total $ 649,000

Financing Arrangements

Financing Arrangements	12 Months Ended
	Jun. 30, 2018
Debt Disclosure [Abstract]
Financing Arrangements	Note 5. Financing Arrangements The Company has a credit facility that provides for a revolving line of credit and a term loan. Effective December 18, 2017, the Company renewed its $2,500,000 revolving line of credit. There was no outstanding principal balance on the line of credit as of June 30, 2018 or June 30, 2017. Interest on borrowings under the line of credit, if any, would accrue at the prime rate (5.00% at June 30, 2018) and is payable monthly. The amount eligible for borrowing on the line of credit is limited to the lesser of $2,500,000 or 57.00% of eligible accounts receivable and the line of credit expires on December 18, 2018, if not renewed. At June 30, 2018, the maximum $2,500,000 was eligible for borrowing. The line of credit is secured by a security interest in substantially all of the tangible and intangible assets of the Company. In connection with the credit facility, the Company also has a term loan, which had an outstanding principal balance of approximately $1,103,000 and $1,154,000 as of June 30, 2018 and 2017, respectively. The term loan was refinanced effective December 18, 2016, reducing the interest rate from 5.00% to 3.88%. The unamortized debt issuance cost associated with this debt was approximately $2,000 and $6,000 as of June 30, 2018 and June 30, 2017, respectively. The term loan bears interest at 3.88%, with monthly payments of principal and interest of approximately $7,900 and a final payment of principal and interest of approximately $1,085,000 due on the maturity date of December 18, 2018. Payment obligations under the term loan are secured by a mortgage on the Company’s real property. The documents governing the line of credit and term loan contain certain financial and nonfinancial covenants that include a minimum tangible net worth covenant of not less than $10,125,000 and restrictions on the Company’s ability to incur certain additional indebtedness or pay dividends. Long-term debt consisted of approximately the following as of June 30, 2018 and 2017: June 30, 2018 2017 Mortgage note payable with bank, due in monthly installments of $7,932, including interest at 3.88%, remaining due December 2018, secured by land and building $ 1,103,000 $ 1,154,000 Less: Current portion (1,101,000 ) (51,000 ) Less: Debt issuance costs, net (2,000 ) (6,000 ) Long-term debt $ — $ 1,097,000 Approximate future maturities of long-term debt, net of debt issuance costs, as of June 30, 2018 were $1,101,000, due December 2018.

Common Stock

Common Stock	12 Months Ended
	Jun. 30, 2018
Equity [Abstract]
Common Stock	Note 6. Common Stock Authorized shares:

Share-Based Compensation

Share-Based Compensation	12 Months Ended
	Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Share-Based Compensation	Note 7. Share-Based Payments Share-based compensation expense for fiscal 2018 and 2017 was approximately $863,000 and $479,000, respectively, related to employee options and restricted stock awards. At June 30, 2018, the Company had approximately $597,000 of unrecognized compensation expense related to non-vested equity awards, which is expected to be recognized over a weighted-average period of 0.9 years. Employee options: The Company recognizes compensation expense related to share-based payment transactions in the financial statements based on the estimated fair value of the award issued. The fair value of each option is estimated using the Black-Scholes pricing model at the time of award grant. The Company estimates the expected life of options based on the expected holding period by the option holder. The risk-free interest rate is based upon observed U.S. Treasury interest rates for the expected term of the options. The Company makes assumptions with respect to expected stock price volatility based upon the volatility of its stock price. Forfeitures are estimated at the time of grant and revised in subsequent periods if actual forfeitures differ from initial estimates. Forfeitures are estimated based on the percentage of awards expected to vest, taking into consideration the seniority level of the award recipient. The following assumptions were used to estimate the fair value of options granted: Years Ended June 30, 2018 2017 Risk-free interest rate 1.77-2.61 % 1.14-1.27 % Expected term (years) 6 6 Expected volatility 125.2-176.5 % 100.5-105.8 % The following table presents employee option activity for fiscal 2018 and 2017: Number of Shares Weighted- Average Grant Date Fair Value Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life (in Years) Options outstanding at June 30, 2016 599,800 $ 1.70 $ 2.62 5.38 Granted 176,500 3.09 3.91 — Canceled or Forfeited (28,666 ) 2.46 3.14 — Options outstanding at June 30, 2017 747,634 2.00 2.91 5.31 Granted 201,250 5.05 5.65 — Exercised (18,492 ) 2.13 3.38 — Canceled or Forfeited (28,333 ) 3.44 4.07 — Options outstanding at June 30, 2018 902,059 2.63 3.47 5.31 Options exercisable at June 30, 2018 706,233 2.11 3.00 4.36 The aggregate intrinsic value of options outstanding was $1,802,000 and options exercisable were $1,714,000 at June 30, 2018. There were 18,492 options exercised during the year ended June 30, 2018 while there were no options exercised during the year ended June 30, 2017. Restricted stock: The Company issued restricted stock awards to employees totaling 30,000 during each of the years ended June 30, 2018 and 2017, with a vesting term of one to three years and a fair value of $5.53 and $3.82 per share, respectively. During the fiscal 2018 and 2017, the Company issued restricted stock awards to directors totaling 10,000 and 13,055 shares of common stock, respectively, with a vesting term of six months and a fair value of $5.77 and $3.83 per share, respectively. Restricted stock transactions during the years ended June 30, 2018 and 2017 are summarized as follows: Shares of Restricted Stock Weighted-Average Grant Date Fair Outstanding at June 30, 2016 19,999 — Granted 43,055 $ 3.82 Vested (33,056 ) $ 3.21 Outstanding at June 30, 2017 29,998 $ 3.15 Granted 40,000 $ 5.59 Vested (40,000 ) $ 4.23 Outstanding at June 30, 2018 29,998 $ 4.96

Income Taxes

Income Taxes	12 Months Ended
	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Income Taxes	Note 8. Income Taxes Components of the provision for income taxes for fiscal 2018 and 2017 were as follows: Years Ended June 30, 2018 2017 Current: Current Federal $ 1,035,000 $ 1,196,000 Current State 225,000 211,000 Total Current 1,260,000 1,407,000 Deferred: Deferred Federal (65,000 ) (108,000 ) Deferred State (69,000 ) (9,000 ) Total Deferred (134,000 ) (117,000 ) Total Income Tax Expense $ 1,126,000 $ 1,290,000 The total income tax expense differed from the expected tax expense, computed by applying the federal statutory rate to the Company’s pretax income, as follows: Years Ended June 30, 2018 2017 Tax expense at statutory federal rate $ 834,000 $ 1,197,000 State income tax expense, net of federal tax effect 115,000 131,000 Remeasurement of deferred taxes under U.S. tax reform 181,000 — Change in uncertain tax positions — (32,000 ) Other permanent items (4,000 ) (6,000 ) Income tax expense $ 1,126,000 $ 1,290,000 The effective tax rates for fiscal 2018 and 2017 were 37.2% and 36.7% respectively. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act significantly revised future and ongoing U.S. corporate tax obligations by, among other things, lowering U.S. corporate income tax rates. Since the Company has a June 30 fiscal year-end, the lower corporate income tax rate will be phased in, resulting in a blended U.S. statutory federal rate of approximately 28% for fiscal 2018, and 21% for subsequent fiscal years. The Tax Act also eliminated the domestic production manufacturing deduction effective for the Company’s tax year beginning July 1, 2018. During the year ended June 30, 2018, these changes under the Tax Act resulted in a net income tax expense of approximately $181,000. The significant components of deferred income taxes were as follows: June 30, 2018 2017 Deferred tax assets (liabilities): Accounts receivable reserves $ 52,000 $ 143,000 Accrued liabilities 273,000 280,000 Property and equipment (317,000 ) (534,000 ) Finite-life intangible assets 2,000 6,000 Stock options 443,000 443,000 Tax credits and net operating loss carryforwards 63,000 46,000 Other 78,000 76,000 Net deferred tax assets $ 594,000 $ 460,000 The Company has net state tax credit carryforwards of $63,000 and which if unused, will begin to expire in years 2025 and 2033. The Company applies the accounting standard for uncertain tax positions pursuant to which a more-likely-than-not threshold is utilized to determine the recognition and derecognition of uncertain tax positions. Once the more-likely-than-not threshold is met, the amount of benefit to be recognized is the largest amount of tax benefit that is greater than 50 percent likely of being ultimately realized upon settlement. It further requires that a change in judgment related to the expected ultimate resolution of uncertain tax positions be recognized in earnings in the period of such a change. The Company does not believe there will be significant changes to the estimates in the next 12-month period. Due to the complexity of some of these uncertainties, the ultimate settlement may result in payments that are different from the Company’s current estimate of tax liabilities, resulting in the recognition of additional charges or benefits to income tax expense. Changes in the Company’s unrecognized tax benefits were approximately as follows: Years Ended June 30, 2018 2017 Beginning balance of unrecognized tax benefits $ — $ 32,000 Lapse of statute of limitations — (32,000 ) Ending balance of unrecognized tax benefits $ — $ — The Company recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense. During the fiscal year ended June 30, 2017 the amount of recognized interest expense, net of tax benefit, and accrued interest on a gross basis was insignificant. The Company is subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. With limited exceptions, tax years prior to fiscal year ended June 30, 2015 are no longer open to federal, state and local examination by taxing authorities.

Commitments and Contingencies a

Commitments and Contingencies and Subsequent Events	12 Months Ended
	Jun. 30, 2018
Commitments And Contingencies And Subsequent Events
Commitments and Contingencies and Subsequent Events	Note 9. Commitments and Contingencies and Subsequent Events Operating leases: Approximate future minimum operating lease payments as of June 30, 2018, were as follows: Fiscal years ending June 30: 2019 $ 198,000 2020 18,000 2021 9,000 Total $ 225,000 Litigation: 401(k) Profit Sharing Plan: Employment Agreements:

Nature of Business and Summar16

Nature of Business and Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Use of estimates	Use of estimates:
Revenue recognition	Revenue recognition: Direct patient sales are recorded at amounts to be received from patients under reimbursement arrangements with third-party payers, including private insurers, prepaid health plans, Medicare and Medicaid. In addition, the Company records an estimate for selling price adjustments that often arise from changes in a patient’s insurance coverage, changes in a patient’s domicile, insurance company coverage limitations or patient death. Other than the installment sales as discussed below, the Company expects to receive payment on the vast majority of accounts receivable within one year and therefore has classified all accounts receivable as current. However, in some instances, payment for direct patient sales can be delayed or interrupted, resulting in a portion of collections occurring later than one year. During fiscal 2017, the Company entered into a settlement agreement with the Centers for Medicare and Medicaid Services with respect to approximately 700 Medicare fee-for-service claims submitted between calendar years 2012 through 2015, resulting in approximately $703,000 of net recognized revenue. Certain third-party reimbursement agencies pay the Company on a monthly installment basis, which can span over several years. Due to the length of time over which cash is collected and the inherent uncertainty of collectability with these installment sales, the Company cannot make a reasonable estimate of revenue at the time of sale and does not record accounts receivable or revenue at the time of product shipment. Under the installment method, the Company defers the revenue associated with the sale and, as each installment is received, that amount is recognized as revenue. Deferred costs associated with the sale are amortized to cost of revenue ratably over the estimated period in which collections are scheduled to occur. Sales made under the installment method were approximately as follows: Years Ended June 30, 2018 2017 Revenue recognized under installment sales $ 1,202,000 $ 1,246,000 Amortized cost of revenues recognized 114,000 161,000 Unrecognized installment method sales were approximately as follows: June 30, 2018 2017 Estimated unrecognized sales, net of discounts $ 1,443,000 $ 1,814,000 Unamortized costs of revenues included in prepaid and other current assets and other assets 169,000 209,000
Shipping and handling expense	Shipping and handling expense:
Cash	Cash:
Accounts receivable	Accounts receivable:
Inventories	Inventories:
Property and equipment	Property and equipment:
Finite-life intangible assets	Finite-life intangible assets:
Long-lived assets	Long-lived assets: If the Company believes the carrying value is unrecoverable, it would recognize an impairment charge necessary to reduce the unamortized balance to the estimated fair value of the asset or asset group. The amount of such impairment would be charged to operations in the current period.
Warranty liability	Warranty liability: Changes in the Company’s warranty liability were approximately as follows: Years Ended June 30, 2018 2017 Beginning warranty reserve $ 640,000 $ 660,000 Accrual for products sold 273,000 129,000 Expenditures and costs incurred for warranty claims (153,000 ) (149,000 ) Ending warranty reserve $ 760,000 $ 640,000
Income taxes	Income taxes: The Company recognizes tax liabilities when the Company believes that certain positions may not be fully sustained upon review by tax authorities. Benefits from tax positions are measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon settlement. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences impact income tax expense in the period in which such determination is made. Interest and penalties, if any, related to accrued liabilities for potential tax assessments are included in income tax expense.
Research and development	Research and development:
Advertising costs	Advertising costs:
Share-based payments	Share-based payments:
Fair value of financial instruments	Fair value of financial instruments:
Basic and diluted earnings per share	Basic and diluted earnings per share:
New Accounting Pronouncements	New Accounting Pronouncements: The Company has substantially completed its assessment of our systems, available data and processes that will be affected by the implementation of this new revenue recognition guidance. As a result of the implementation of this standard, the Company expects to record an adjustment to increase retained earnings as of July 1, 2017 to reflect the cumulative effect of adoption of the new standard. At this time, the Company estimates this increase to be approximately $0.8 million. This adjustment reflects the acceleration of $1.4 million in revenues, partially offset by $0.4 million in deferred taxes, $0.1 million in costs of revenues and $0.1 million in selling, general and administrative costs. The July 1, 2017 balance sheet will include an increase of $1.4 million in accounts receivable, a $0.1 million increase in inventory, a $0.1 million decrease in other current assets, a $0.1 million decrease in other long-term assets, a $0.4 million decrease in deferred income taxes, a $0.1 million increase in accrued compensation and a $0.8 million increase in retained earnings. In addition, the Company will record an adjustment to restate fiscal 2018 to comparative operating results under the new guidance in its quarterly and annual financial statements during the fiscal year ending June 30, 2019, which will include additional required disclosures. The adjustment will result in a decrease in revenues of approximately $0.4 million and a decrease in currently reported net income of approximately $0.1 million for fiscal 2018. The adjustments to retained earnings as of July 1, 2017 and to restate operating results for its fiscal 2018 comparative annual period were primarily driven by changes in our accounting for sales that are: ● subject to reimbursement from certain third-party agencies on a monthly installment basis. Previously, the Company deferred revenue at the time of sale and, as each installment became billable and other criteria was met, revenue was recognized. ● subject to reimbursement under contracts where coverage is unconfirmed, payments are in appeal or are due from the patient, and where variable consideration is estimable. Previously, the Company fully deferred revenue at the time of sale until fixed and determinable. Under the new guidance, the Company will estimate variable consideration in the transaction price at contract inception based on historical experience and other relevant factors and recognize revenue at the time of sale. In July 2015, FASB issued ASU 2015-11, “Inventory (Topic 330) Related to Simplifying the Measurement of Inventory,” which applies to all inventory except that which is measured using last-in, first-out (“LIFO”) or the retail inventory method. Inventory measured using first-in, first-out (“FIFO”) or average cost is within the scope of the new guidance and should be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The new guidance is applied prospectively, and earlier application is permitted as of the beginning of an interim or annual reporting period. The Company adopted ASU 2015-11 effective July 1, 2017, which had no material impact on its financial statements or financial statement disclosures. In February 2016, FASB issued ASU 2016-02, “Leases.” This standard requires the recognition of all lease transactions with terms in excess of 12 months on the balance sheet as a lease liability and a right-of-use asset (as defined in the standard). ASU 2016-02 will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with earlier application permitted. Upon adoption, the lessee will apply the new standard retrospectively to all periods presented or retrospectively using a cumulative effect adjustment in the year of adoption. ASU 2016-02 is not expected to have a material impact on the Company’s financial statements or financial statement disclosures upon adoption based on current facts and circumstances. In March 2016, FASB issued ASU 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,” which reduces complexity in accounting standards related to share-based payment transactions, including, among others, (1) accounting for income taxes, (2) classification of excess tax benefits on the statement of cash flow, (3) forfeitures, and (4) statutory tax withholding requirements. ASU 2016-09 is effective for annual reporting periods beginning on or after December 15, 2016, and interim periods within those annual periods. The Company adopted ASU 2016-09 effective July 1, 2017, which had no material impact on its previously reported financial statements included in the Company’s Annual Report on Form 10-K for fiscal 2017. The Company has elected to continue to recognize estimated forfeitures as stock-based compensation expense.

Nature of Business and Summar17

Nature of Business and Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Summary of sales made under the installment method	Sales made under the installment method were approximately as follows: Years Ended June 30, 2018 2017 Revenue recognized under installment sales $ 1,202,000 $ 1,246,000 Amortized cost of revenues recognized 114,000 161,000 Unrecognized installment method sales were approximately as follows: June 30, 2018 2017 Estimated unrecognized sales, net of discounts $ 1,443,000 $ 1,814,000 Unamortized costs of revenues included in prepaid and other current assets and other assets 169,000 209,000
Schedule of changes in warranty liability	Changes in the Company’s warranty liability were approximately as follows: Years Ended June 30, 2018 2017 Beginning warranty reserve $ 640,000 $ 660,000 Accrual for products sold 273,000 129,000 Expenditures and costs incurred for warranty claims (153,000 ) (149,000 ) Ending warranty reserve $ 760,000 $ 640,000

Inventories (Tables)

Inventories (Tables)	12 Months Ended
	Jun. 30, 2018
Inventory Disclosure [Abstract]
Schedule of components of inventories	The components of inventories at June 30, 2018 and 2017 were approximately as follows: June 30, 2018 2017 Parts inventory $ 1,388,000 $ 1,789,000 Work in process 621,000 205,000 Finished goods 632,000 745,000 Less: Reserve for obsolescence (280,000 ) (180,000 ) Total $ 2,361,000 $ 2,559,000

Property and Equipment (Tables)

Property and Equipment (Tables)	12 Months Ended
	Jun. 30, 2018
Property, Plant and Equipment [Abstract]
Schedule of property and equipment, including assets under capital leases	Property and equipment, including assets under capital leases, were approximately as follows: Estimated Useful June 30, 2018 2017 Building and building improvements 15-39 $ 2,263,000 $ 2,236,000 Land N/A 200,000 200,000 Land improvements 15 166,000 166,000 Equipment 3-7 3,131,000 2,982,000 Demonstration and rental equipment 3 1,071,000 959,000 6,831,000 6,543,000 Less: Accumulated depreciation (3,740,000 ) (3,240,000 ) Net property and equipment $ 3,091,000 $ 3,303,000

Finite-life Intangible Assets (

Finite-life Intangible Assets (Tables)	12 Months Ended
	Jun. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of activity and net balances of finite-life intangible assets	The activity and net balances of finite-life intangible assets were approximately as follows: Years Ended June 30, 2018 2017 Balance, beginning $ 721,000 $ 904,000 Additions 46,000 68,000 Abandonments (4,000 ) (133,000 ) Amortization expense (114,000 ) (118,000 ) Balance, ending $ 649,000 $ 721,000
Schedule of future amortization of finite-life intangible assets	Based on the carrying value as of June 30, 2018, future amortization is expected to be as follows: Fiscal years ending June 30: 2019 $ 114,000 2020 113,000 2021 113,000 2022 79,000 2023 17,000 Thereafter 213,000 Total $ 649,000

Financing Arrangements (Tables)

Financing Arrangements (Tables)	12 Months Ended
	Jun. 30, 2018
Debt Disclosure [Abstract]
Schedule of long-term debt	Long-term debt consisted of approximately the following as of June 30, 2018 and 2017: June 30, 2018 2017 Mortgage note payable with bank, due in monthly installments of $7,932, including interest at 3.88%, remaining due December 2018, secured by land and building $ 1,103,000 $ 1,154,000 Less: Current portion (1,101,000 ) (51,000 ) Less: Debt issuance costs, net (2,000 ) (6,000 ) Long-term debt $ — $ 1,097,000

Share-Based Compensation (Table

Share-Based Compensation (Tables)	12 Months Ended
	Jun. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of assumptions used to estimate fair value of options granted	The following assumptions were used to estimate the fair value of options granted: Years Ended June 30, 2018 2017 Risk-free interest rate 1.77-2.61 % 1.14-1.27 % Expected term (years) 6 6 Expected volatility 125.2-176.5 % 100.5-105.8 %
Schedule of employee option activity	The following table presents employee option activity for fiscal 2018 and 2017: Number of Shares Weighted- Average Grant Date Fair Value Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life (in Years) Options outstanding at June 30, 2016 599,800 $ 1.70 $ 2.62 5.38 Granted 176,500 3.09 3.91 — Canceled or Forfeited (28,666 ) 2.46 3.14 — Options outstanding at June 30, 2017 747,634 2.00 2.91 5.31 Granted 201,250 5.05 5.65 — Exercised (18,492 ) 2.13 3.38 — Canceled or Forfeited (28,333 ) 3.44 4.07 — Options outstanding at June 30, 2018 902,059 2.63 3.47 5.31 Options exercisable at June 30, 2018 706,233 2.11 3.00 4.36
Schedule of restricted stock transactions	Restricted stock transactions during the years ended June 30, 2018 and 2017 are summarized as follows: Shares of Restricted Stock Weighted-Average Grant Date Fair Outstanding at June 30, 2016 19,999 — Granted 43,055 $ 3.82 Vested (33,056 ) $ 3.21 Outstanding at June 30, 2017 29,998 $ 3.15 Granted 40,000 $ 5.59 Vested (40,000 ) $ 4.23 Outstanding at June 30, 2018 29,998 $ 4.96

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Schedule of components of the provision for income taxes	Components of the provision for income taxes for fiscal 2018 and 2017 were as follows: Years Ended June 30, 2018 2017 Current: Current Federal $ 1,035,000 $ 1,196,000 Current State 225,000 211,000 Total Current 1,260,000 1,407,000 Deferred: Deferred Federal (65,000 ) (108,000 ) Deferred State (69,000 ) (9,000 ) Total Deferred (134,000 ) (117,000 ) Total Income Tax Expense $ 1,126,000 $ 1,290,000
Schedule of effective income tax reconciliation	The total income tax expense differed from the expected tax expense, computed by applying the federal statutory rate to the Company’s pretax income, as follows: Years Ended June 30, 2018 2017 Tax expense at statutory federal rate $ 834,000 $ 1,197,000 State income tax expense, net of federal tax effect 115,000 131,000 Remeasurement of deferred taxes under U.S. tax reform 181,000 — Change in uncertain tax positions — (32,000 ) Other permanent items (4,000 ) (6,000 ) Income tax expense $ 1,126,000 $ 1,290,000
Schedule of significant components of deferred income taxes	The significant components of deferred income taxes were as follows: June 30, 2018 2017 Deferred tax assets (liabilities): Accounts receivable reserves $ 52,000 $ 143,000 Accrued liabilities 273,000 280,000 Property and equipment (317,000 ) (534,000 ) Finite-life intangible assets 2,000 6,000 Stock options 443,000 443,000 Tax credits and net operating loss carryforwards 63,000 46,000 Other 78,000 76,000 Net deferred tax assets $ 594,000 $ 460,000
Schedule of changes in unrecognized tax benefits	Changes in the Company’s unrecognized tax benefits were approximately as follows: Years Ended June 30, 2018 2017 Beginning balance of unrecognized tax benefits $ — $ 32,000 Lapse of statute of limitations — (32,000 ) Ending balance of unrecognized tax benefits $ — $ —

Commitments and Contingencies24

Commitments and Contingencies and Subsequent Events (Tables)	12 Months Ended
	Jun. 30, 2018
Commitments And Contingencies And Subsequent Events Tables Abstract
Schedule of the future minimum operating lease payments	Approximate future minimum operating lease payments as of June 30, 2018, were as follows: Fiscal years ending June 30: 2019 $ 198,000 2020 18,000 2021 9,000 Total $ 225,000

Nature of Business and Summar25

Nature of Business and Summary of Significant Accounting Policies (Details Narrative)	12 Months Ended
	Jun. 30, 2018USD ($)shares	Jun. 30, 2017USD ($)shares	Jul. 02, 2017USD ($)
Common stock equivalents excluded from calculation of diluted earnings per share | shares	187,834	177,500
Net recognized revenue from settlement agreement		$ 703,000
Number of 2012-2015 Medicare fee-for-service claims		700
Shipping and handling charges	$ 409,000	$ 363,000
Advertising, marketing and trade show costs	474,000	380,000
Accounts receivable, allowance for doubtful accounts	45,000	45,000
Expected New Accounting Pronouncement Changes:
Change in revenues	28,697,622	25,861,144
Increase in cost of revenues	5,841,601	5,292,715
Increase in selling, general and administrative costs	19,596,053	16,402,214
Net income	$ 1,902,396	$ 2,229,472
Expected Adjustments for New Accounting Principle [Member]
Expected New Accounting Pronouncement Changes:
New Accounting Pronouncement Effect on Financial Statements	Yes	Yes
Cumulative effect of adoption of the new standard on retained earnings		$ 800,000
Change in revenues	$ (400,000)	1,400,000
Decrease in deferred assets		400,000
Increase in cost of revenues		100,000
Increase in selling, general and administrative costs		100,000
Net income	(100,000)
Expected Adjustments for New Accounting Principle [Member] | Accounts Receivable [Member]
Expected New Accounting Pronouncement Changes:
Change in balance sheet line expected from adoption of new standard			$ 1,400,000
Expected Adjustments for New Accounting Principle [Member] | Inventories [Member]
Expected New Accounting Pronouncement Changes:
Change in balance sheet line expected from adoption of new standard			100,000
Expected Adjustments for New Accounting Principle [Member] | Other Current Assets [Member]
Expected New Accounting Pronouncement Changes:
Change in balance sheet line expected from adoption of new standard			(100,000)
Expected Adjustments for New Accounting Principle [Member] | Long-term Assets [Member]
Expected New Accounting Pronouncement Changes:
Change in balance sheet line expected from adoption of new standard			(100,000)
Expected Adjustments for New Accounting Principle [Member] | Deferred Income Taxes [Member]
Expected New Accounting Pronouncement Changes:
Change in balance sheet line expected from adoption of new standard			(400,000)
Expected Adjustments for New Accounting Principle [Member] | Accrued Liabilities [Member]
Expected New Accounting Pronouncement Changes:
Change in balance sheet line expected from adoption of new standard			$ (100,000)
International [Member]
Sales	$ 501,000	$ 716,000
North America [Member]
Warranty term	3 years

Nature of Business and Summar26

Nature of Business and Summary of Significant Accounting Policies (Details) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Sales made under the installment method:
Revenue recognized under installment sales	$ 1,202,000	$ 1,246,000
Amortized cost of revenues recognized	114,000	161,000
Unrecognized installment method sales:
Estimated unrecognized sales, net of discounts	1,443,000	1,814,000
Unamortized costs of revenues included in prepaid and other current assets and other assets	$ 169,000	$ 209,000

Nature of Business and Summar27

Nature of Business and Summary of Significant Accounting Policies (Details 1) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Warranty reserve:
Warranty reserve, beginning	$ 640,000	$ 660,000
Accrual for products sold	273,000	129,000
Expenditures and costs incurred for warranty claims	(153,000)	(149,000)
Warranty reserve, ending	$ 760,000	$ 640,000

Inventories (Details)

Inventories (Details) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Inventory Disclosure [Abstract]
Parts inventory	$ 1,388,000	$ 1,789,000
Work in process	621,000	205,000
Finished goods	632,000	745,000
Less: Reserve for obsolescence	(280,000)	(180,000)
Total	$ 2,360,693	$ 2,559,485

Property and Equipment (Details

Property and Equipment (Details Narrative) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Property and Equipment [Member]
Value of assets impaired or disposed, net	$ 26,000	$ 3,000

Property and Equipment (Detai30

Property and Equipment (Details) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 6,831,000	$ 6,543,000
Less: Accumulated depreciation	(3,740,000)	(3,240,000)
Net property and equipment	3,091,242	3,303,233
Building and Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 2,263,000	2,236,000
Building and Building Improvements [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	15 years
Building and Building Improvements [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	39 years
Land Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 166,000	166,000
Estimated useful life	15 years
Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 3,131,000	2,982,000
Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	3 years
Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life	7 years
Demonstration and Rental Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,071,000	959,000
Estimated useful life	3 years
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 200,000	$ 200,000

Finite-life Intangible Assets31

Finite-life Intangible Assets (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Finite-Lived Intangible Assets [Line Items]
Accumulated amortization	$ 902,000	$ 790,000
Patents [Member]
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	15 years
Abandoned patents	$ 4,000	$ 133,000
Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	12 years

Finite-life Intangible Assets32

Finite-life Intangible Assets (Details) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Balance, beginning	$ 721,276	$ 904,000
Additions	46,000	68,000
Abandonments	(4,000)	(133,000)
Amortization expenses	(114,000)	(118,000)
Balance, ending	$ 649,103	$ 721,276

Finite-life Intangible Assets33

Finite-life Intangible Assets (Details 1) - USD ($)	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2016
Fiscal years ending June 30:
2,019	$ 114,000
2,020	113,000
2,021	113,000
2,022	79,000
2,023	17,000
Thereafter	213,000
Total	$ 649,103	$ 721,276	$ 904,000

Financing Arrangements (Details

Financing Arrangements (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 17, 2016
Future maturities of long term debt, due December 2018	$ 1,101,000
Term Loan [Member]
Interest rate	3.88%		5.00%
Principal loan amount	$ 1,103,000	$ 1,154,000
Unamortized debt issuance cost	2,000	6,000
Monthly payments of principal and interest	7,900
Final payment of principal and interest	$ 1,085,000
Term loan maturity date	Dec. 18, 2018
Minimum tangible net worth to be maintained	$ 10,125,000
Mortgage Note Payable with bank [Member]
Interest rate	3.88%
Principal loan amount	$ 1,103,000	1,154,000
Unamortized debt issuance cost	2,000	$ 6,000
Monthly payments of principal and interest	7,932
Credit Facility [Member]
Maximum borrowing capacity	$ 2,500,000
Credit facility effective date	Dec. 18, 2017
Credit facility expiration date	Dec. 18, 2018
Effective interest rate	5.00%
Borrowing capacity of eligible accounts receivable	$ 2,500,000
Borrowing capacity of eligible accounts receivable (percent)	57.00%
Available borrowing capacity	$ 2,500,000

Financing Arrangements (Detai35

Financing Arrangements (Details) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Less: Current portion	$ (1,101,043)	$ (50,703)
Long-term debt		1,097,125
Mortgage Note Payable [Member]
Debt	1,103,000	1,154,000
Less: Current portion	(1,101,000)	(51,000)
Unamortized debt issuance cost	(2,000)	(6,000)
Long-term debt	$ 0	$ 1,097,000

Common Stock (Details Narrative

Common Stock (Details Narrative) - $ / shares	Jun. 30, 2018	Jun. 30, 2017
Common stock, shares authorized	13,000,000	13,000,000
Common stock, par value	$ 0.01	$ 0.01
Undesignated Stock [Member]
Common stock, shares authorized	2,000,000
Common Stock [Member]
Common stock, shares authorized	13,000,000
Common stock, par value	$ 0.01
Capital Stock [Member]
Common stock, shares authorized	15,000,000

Share-Based Compensation (Detai

Share-Based Compensation (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Nov. 01, 2017
Share-based compensation expense	$ 862,674	$ 479,482
Unrecognized compensation expense	$ 597,000
Unrecognized compensation expense, period for recognition	10 months 25 days
Options outstanding, intrinsic value	$ 1,802,000
Options exercisable, intrinsic value	$ 1,714,000
2017 Plan [Member]
Shares available for issuance			900,000
Available for grant, shares			871,000
Issuance of stock options under plan	9,000
Options outstanding (shares)	19,000
2014 Plan [Member]
Issuance of stock options under plan	182,250
Options outstanding (shares)	883,059
Restricted Stock [Member]
Fair value of award (per share)	$ 5.59	$ 3.82
Restricted Stock [Member] | Employees [Member]
Issuance of restricted stock awards (shares)	30,000	30,000
Fair value of award (per share)	$ 5.53	$ 3.82
Restricted Stock [Member] | Employees [Member] | Minimum [Member]
Award vesting term	1 year	1 year
Restricted Stock [Member] | Employees [Member] | Maximum [Member]
Award vesting term	3 years	3 years
Restricted Stock [Member] | Directors [Member]
Issuance of restricted stock awards (shares)	10,000	13,055
Fair value of award (per share)	$ 5.77	$ 3.83
Award vesting term	6 months	6 months
Restricted Stock [Member] | 2017 Plan [Member]
Restricted Stock outstanding (shares)	10,000

Share-Based Compensation (Det38

Share-Based Compensation (Details) - Stock Options [Member]	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Risk free interest rate - minimum	1.77%	1.14%
Risk free interest rate - maximum	2.61%	1.27%
Expected term (year)	6 years	6 years
Expected volatility - minimum	125.20%	100.50%
Expected volatility - maximum	176.50%	105.80%

Share-Based Compensation (Det39

Share-Based Compensation (Details 1) - Stock Options [Member] - $ / shares	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2016
Number of Shares
Options outstanding, beginning	747,634	599,800
Granted	201,250	176,500
Exercised	(18,492)
Cancelled or Forfeited	(28,333)	(28,666)
Options outstanding, ending	902,058	747,634	599,800
Options exercisable, ending	706,233
Weighted Average Grant Date Fair Value
Options outstanding, beginning	$ 2	$ 1.70
Granted	5.05	3.09
Exercised	2.13
Cancelled or Forfeited	3.44	2.46
Options outstanding, ending	2.63	2	$ 1.70
Options exercisable, ending	2.11
Weighted Average Exercise Price
Options outstanding, beginning	2.91	2.62
Granted	5.65	3.91
Exercised	3.38
Cancelled or Forfeited	4.07	3.14
Options outstanding, ending	3.47	$ 2.91	$ 2.62
Options exercisable, ending	$ 3
Weighted-Average Remaining Contractual Life
Options outstanding	5 years 3 months 22 days	5 years 3 months 22 days	5 years 4 months 17 days
Options exercisable	4 years 4 months 9 days

Share-Based Compensation (Det40

Share-Based Compensation (Details 2) - Restricted Stock [Member] - $ / shares	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Number of Shares
Outstanding, beginning	29,998	19,999
Granted	40,000	43,055
Vested	(40,000)	(33,056)
Outstanding, ending	69,998	29,998
Weighted Average Grant Date Fair Value
Outstanding, beginning	$ 3.15	$ 0
Granted	5.59	3.82
Vested	4.23	3.21
Outstanding, ending	$ 4.96	$ 3.15

Income Taxes (Details Narrative

Income Taxes (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2017
U.S. statutory federal rate		28.00%
Effective tax rate		37.20%	36.70%
Income tax expense from changes under Tax Act		$ 181,000
State Jurisdiction [Member]
Tax credit carryforwards		$ 63,000
Subsequent Fiscal Years [Member]
U.S. statutory federal rate	21.00%

Income Taxes (Details)

Income Taxes (Details) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Current
Current Federal	$ 1,035,000	$ 1,196,000
Current State	225,000	211,000
Total Current	1,260,000	1,407,000
Deferred
Deferred Federal	(65,000)	(108,000)
Deferred State	(69,000)	(9,000)
Deferred	(134,000)	(117,000)
Income tax expense	$ 1,126,000	$ 1,290,000

Income Taxes (Details 1)

Income Taxes (Details 1) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Income Tax Disclosure [Abstract]
Tax expense at statutory federal rate	$ 834,000	$ 1,197,000
State income tax expense, net of federal tax benefit	115,000	131,000
Remeasurement of deferred taxes under U.S. tax reform	181,000
Change in unceratin tax positions		(32,000)
Other permanent items	(4,000)	(6,000)
Income tax expense	$ 1,126,000	$ 1,290,000

Income Taxes (Details 2)

Income Taxes (Details 2) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Deferred tax assets (liabilities):
Accounts receivable reserves	$ 52,000	$ 143,000
Accrued liabilities	273,000	280,000
Property and equipment	(317,000)	(534,000)
Finite-life intangible assets	2,000	6,000
Stock options	443,000	443,000
Tax credits and net operating loss carryforwards	63,000	46,000
Other	78,000	76,000
Net deferred tax assets	$ 594,000	$ 460,000

Income Taxes (Details 3)

Income Taxes (Details 3) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Income Tax Disclosure [Abstract]
Beginning balance of unrecognized tax benefits	$ 0	$ 32,000
Lapse of statute of limitations	0	(32,000)
Ending balance of unrecognized tax benefits	$ 0	$ 0

Commitments and Contingencies46

Commitments and Contingencies and Subsequent Events (Details Narrative)	12 Months Ended
	Jun. 30, 2018USD ($)h	Jun. 30, 2017USD ($)
Number of operating leases	5
Lease expiration	Jul. 31, 2019
Rent expense	$ 190,000	$ 175,000
Minimum [Member]
Escalating payments per month	450
Maximum [Member]
Escalating payments per month	$ 9,900
Office Equipment [Member]
Lease expiration	Dec. 31, 2021
Monthly lease payment	$ 1,500
401K Profit Sharing Plan [Member]
Employee benefit plan, minimum age requirement	21 years
Employee benefit plan, requisite service hours | h	1,000
Employee benefit plan, employer contribution	$ 285,000	$ 248,000
Maximum matching contribution of employee's salary	4.00%

Commitments and Contingencies47

Commitments and Contingencies and Subsequent Events (Details)	Jun. 30, 2018USD ($)
Year ending June 30:
2,019	$ 198,000
2,020	18,000
2,021	9,000
Total	$ 225,000