Earnings Per Share

3 Months Ended

Jun. 30, 2012

Earnings Per Share:

Earnings Per Share

EARNINGS (LOSS) PER SHARE

Earnings (loss) per share are computed on the basis of the weighted average number of shares and common stock equivalents outstanding during the period.  In the calculation of diluted earnings per share, shares outstanding are adjusted to assume conversion of the Company’s non-interest bearing convertible stock and exercise of options as if they were dilutive.  In the calculation of basic earnings (loss) per share, weighted average numbers of shares outstanding are used as the denominator.

In the calculation of basic earnings (loss) per share, weighted average numbers of shares outstanding are used as the denominator.  The Company had net income allocable to common stockholders for the three and six months ended June 30, 2012 and net (loss) allocable to common stockholders for the three and six months ended June 30, 2011.   Earnings (loss) per share are computed as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
		2012		2011			2012		2011
Numerator:
Net income (loss) available to common shareholders     basic	$	885,000	$	(839,000	)	$	177,000	$	(281,000	)
Preferred dividend		75,000		-			-		-
Net income (loss) available to common shareholders    diluted		960,000		(839,000	)		177,000		(281,000	)
Denominator:
Weighted average shares used to compute net earnings    (loss) available to common shareholders per common share-basic		3,568,000		3,560,000			3,568,000		3,557,000
Preferred shares assumed to be converted to common		826,000		-			-		-
Effect of dilutive stock options		17,000		-			-		-
Weighted average shares used to compute net earnings (loss) available to shareholders per common  share-dilutive		4,411,000		3,560,000			3,568,000		3,557,000
Basic net earnings (loss) per share to common  shareholder	$	0.25	$	(0.24	)	$	0.05		(0.08	)
Dilutive net earnings (loss) per share to common  shareholder	$	0.22	$	(0.24	)	$	0.05		(0.08	)

All options outstanding to purchase shares of common stock and shares of common stock issued on the assumed conversion of the eligible preferred stock were excluded from the diluted loss per common share calculation for the six months ended June 30, 2012, and the three and six months ended June 30, 2011 as the inclusion of these options would have been antidilutive.