Net Income and Loss per Share

9 Months Ended

Jun. 30, 2012

Earnings Per Share [Text Block]

Note 3.   Net Income and Loss per Share

Earnings per share is calculated in accordance with the ASC Topic 260, “Earnings Per Share.”  Basic net income or loss per share is computed by dividing the net income or loss available to common stock holders by the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible shares and stock options and warrants were converted or exercised. Also, under this method, convertible notes are treated as if they were converted at the beginning of the period.  There was no difference between the basic and diluted weighted average shares or earnings for the three and nine months ended June 30, 2012 and 2011 as all common stock equivalents were anti-dilutive due to net losses. The following common stock equivalents were excluded from net loss per share computations. 

	Three months ended June 30,		Nine months ended June 30,
	2012	2011	2012	2011
Convertible Preferred Stock	162,372,288	9,472,340	162,372,288	9,472,340
Convertible debt	11,866,336	44,965,670	11,866,336	44,965,670
Common stock options	260,882,543	21,282,543	260,882,543	21,282,543
Common stock purchase warrants	241,021,747	5,481,119	241,021,747	5,481,119

All the common stock equivalents outstanding which, if added to common stock outstanding, would put common stock in excess of total authorized shares as of June 30, 2012.  As of June 30, 2012, our Preferred Stock Series B is convertible only at our election, and in the case of our Preferred Series C only after 6 months outstanding.  Also, the ability to exercise certain warrants and options is conditioned upon an increase in our authorized shares. As a result we do not have outstanding securities that could convert into more common shares than we currently have authorized.