Note 11 - Earnings Per Share

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Text Block]

Earnings Per Share [Text Block]

NOTE 11. EARNINGS PER SHARE

For the three and six months ended June 30, 2013 and 2012, basic earnings per share are computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. Unexercised stock options are excluded from this calculation but are included in the diluted earnings per share calculation using the treasury stock method so long as their effect is not anti-dilutive.  In the first quarter of 2013, the Company re-evaluated its accounting for the treatment of restricted stock awards in computing earnings per share. As a result the Company concluded that the shares are participating securities and accordingly have included them in the calculation of weighted average shares outstanding in the current period.  The effects on prior period presentation of earnings per share are immaterial.

For the three and six months ended June 30, 2013 and 2012, diluted earnings per share are determined by using the weighted average number of common and dilutive common equivalent shares outstanding during the period.  Due to the anti-dilutive effect, approximately 135,200 and 132,200 options to purchase common stock and restricted stock awards were excluded from the calculation of diluted earnings per share for the three and six months ended June 30, 2013, respectively.  For the three and six months ended June 30 2012, the diluted effect of stock options and restricted stock grants of approximately 246,700 and 202,300 shares, respectively, were not included in the computation of diluted loss per share as the net loss would have made their effect anti-dilutive.

The following table illustrates the reconciliation of the weighted average shares outstanding:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Weighted average shares outstanding - Basic		10,499,217		10,319,901		10,503,740		10,330,851
Diluted effect of stock options and restricted stock grants		18,164		-		18,164		-
Weighted average shares outstanding - Diluted		10,517,381		10,319,901		10,521,904		10,330,851