Income Taxes

9 Months Ended

Sep. 30, 2011

Income Tax Disclosure [Abstract]

Income Taxes

NOTE F – Income Taxes

Our tax provision for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter we update our estimate of the annual effective tax rate, and if our estimated tax rate changes we make a year to date adjustment.

The income tax expense for the nine months ended September 30, 2011 includes an adjustment of $155,000 to reduce the balance of our income tax receivables based on an analysis following actual refunds. During the first nine months of 2010 the income tax expense that would have otherwise been recognized was virtually offset by a reduction in the valuation allowance for deferred taxes. Income tax expense includes Texas state tax, which is based on gross profit and not pre-tax income or loss.