Note 2 – Earnings Per Share and Share Repurchase Plan

The following table sets forth the computation of basic and diluted earnings per share:

Year ended December 31,	2017		2016		2015
Numerator for basic and diluted earnings per share - net income	$	8,289	$	8,924	$	8,233
Denominator for basic earnings per share - weighted average shares outstanding		3,428,970		3,386,766		3,337,505
Effect of dilutive securities - employee stock options		16,841		9,073		13,034
Denominator for diluted earnings per share - adjusted weighted average shares outstanding		3,445,811		3,395,839		3,350,539
Earnings per share - basic	$	2.42	$	2.64	$	2.47
Earnings per share - diluted	$	2.41	$	2.63	$	2.46

There were 25,000, 23,500, and 21,000 stock options that were anti-dilutive as of December 31, 2017, 2016, and 2015 respectively. These stock options were not included in the above calculation.

On January 24, 2008, QNB announced that the Board of Directors authorized the repurchase of up to 50,000 shares of its common stock in open market or privately negotiated transactions. On February 9, 2009, the Board of Directors approved increasing the authorization to 100,000 shares. The repurchase authorization does not bear a termination date. There were no shares repurchased during the years ended December 31, 2017 or 2016. As of December 31, 2017 and 2016, 57,883 shares were repurchased under this authorization at an average price of $16.97 and a total cost of $982,000 and were recorded to Treasury stock.