5. Earnings Per Share


	Three Months Ended June 30,				Nine Months Ended June 30,
	2020		2019		2020		2019
Numerator:
Net income	$	1,259,858	$	511,259	$	2,025,871	$	853,179
Denominator:
Basic weighted average shares		16,952,973		16,880,341		16,931,049		16,860,503
Dilutive effect of share-based awards		134,302		98,302		166,365		37,818
Diluted weighted average shares		17,087,275		16,978,643		17,097,414		16,898,321

Earnings per common share:
Basic EPS	$	0.07	$	0.03	$	0.12	$	0.05
Diluted EPS	$	0.07	$	0.03	$	0.12	$	0.05

Earnings per share (“EPS”) are calculated pursuant to FASB ASC Topic 260, “Earnings Per Share.” Basic EPS excludes potentially dilutive securities and is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS is computed assuming the conversion or exercise of all dilutive securities such as employee stock options.

The number of incremental shares from the assumed exercise of stock options is calculated by using the treasury stock method. As of June 30, 2020 and 2019, there were 548,500 and 550,834 options to purchase common stock outstanding, respectively. The average outstanding diluted shares calculation excludes options with an exercise price that exceeds the average market price of shares during the period.

For the three months ended June 30, 2020 and 2019, respectively, 0 and 250,000 diluted weighted-average shares outstanding were excluded from the computation of diluted EPS because the effect would be anti-dilutive.

For the nine months ended June 30, 2020 and 2019, respectively, 0 and 367,223 diluted weighted-average shares outstanding were excluded from the computation of diluted EPS because the effect would be anti-dilutive.