Earnings Per Share

6 Months Ended

Jun. 30, 2013

Earnings Per Share:

Earnings Per Share

10.   (LOSS) EARNINGS PER SHARE

(Loss) earnings per share is computed on the basis of the weighted average number of shares and common stock equivalents outstanding during the period.  In the calculation of diluted loss 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 (loss) earnings per share, weighted average numbers of shares outstanding are used as the denominator.

The Company had net loss allocable to common stockholders for the three and six months ended June 30, 2013 and net income allocable to common stockholders for the three and six months ended June 30, 2012.   (Loss) earnings per share is computed as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2013			2012		2013			2012
Numerator:
Net (loss) income  available to common shareholders basic	$	(1,029,000	)	$	885,000	$	(2,123,000	)	$	177,000
Preferred dividend		-			75,000		-			-
Net (loss) income available to common shareholders diluted		(1,029,000	)		960,000		(2,123,000	)		177,000	)
Denominator:
Weighted average shares used to compute net (loss) earnings available to common shareholders per common share-basic		3,591,000			3,568,000		3,591,000			3,568,000
Preferred shares assumed to be converted to common		-			826,000		-			-
Effect of dilutive stock options		-			17,000		-			-
Weighted average shares used to compute net (loss) earnings available to shareholders per common share-dilutive		3,591,000			4,411,000		3,591,000			3,568,000
Basic net (loss) earnings per share to common shareholder	$	(0.29	)	$	0.25	$	(0.59	)		0.05
Dilutive net (loss) earnings per share to common shareholder	$	(0.29	)	$	0.22	$	(0.59	)		0.05

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 three months ended June 30, 2013 and for the six months ended June 30, 2013 and 2012, as the inclusion of these options would have been antidilutive.