11. EARNINGS PER COMMON SHARE

6 Months Ended

Jun. 30, 2012

NOTE 11: EARNINGS PER COMMON SHARE

Basic earnings per share (“EPS”) is calculated by dividing net income (loss) by the weighted-average number of common shares outstanding for the period. Diluted EPS is calculated by dividing net income (loss) by the weighted-average number of common shares plus dilutive common stock equivalents (warrants and stock options) outstanding during the period. Diluted EPS reflects the potential dilution that could occur if warrants and options to purchase common stock were exercised.

At June 30, 2012 and 2011, there were outstanding warrants convertible to 22 shares of common stock. At June 30, 2012 and 2011, there were outstanding stock options convertible to 609 and 287 shares of common stock, respectively. For the six months ended June 30, 2012 and 2011, there were no potentially dilutive common stock equivalents that were included in the computation of diluted earnings per share because the exercise price for the outstanding warrants and options exceeded the average market price for our common stock.