4. Earnings per share

6 Months Ended

Jun. 30, 2016

4. Earnings per share

The following table sets forth the reconciliation of basic weighted average shares outstanding and diluted weighted average shares outstanding:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2016		2015		2016		2015
	(In thousands, except per share data)

Net income	$	753	$	1,388	$	1,378	$	1,532

Shares:
Basic: Weighted average common shares outstanding		7,689		7,798		7,761		7,827
Add: Dilutive effect of outstanding options as determined by the treasury stock method		54		21		52		20
Diluted: Weighted average common and common equivalent shares outstanding		7,743		7,819		7,813		7,847

Net income per common share:
Basic	$	0.10	$	0.18	$	0.18	$	0.20
Diluted	$	0.10	$	0.18	$	0.18	$	0.20

The computation of diluted earnings per share excludes the effect of the potential exercise of stock awards, including stock options, restricted stock units and performance stock awards, when the average market price of the common stock is lower than the exercise price of the related stock award during the period. These outstanding stock awards are not included in the computation of diluted earnings per share because the effect would be anti-dilutive. For the three months ended June 30, 2016 and 2015, there were 827,000 and 877,000, respectively, potentially dilutive shares consisting of stock awards that were excluded from the calculation of earnings per diluted share. For the six months ended June 30, 2016 and 2015, there were 827,000 and 877,000, respectively, potentially dilutive shares consisting of stock awards that were excluded from the calculation of earnings per diluted share.