1. UNAUDITED INTERIM FINANCIAL STATEMENTS: Income (Loss) Per Share (Policies)

3 Months Ended

Mar. 31, 2020

Policies

Income (Loss) Per Share

Income (Loss) Per Share

Income (loss) per share – basic is calculated by dividing net income (loss) by the weighted average number of shares of stock outstanding during the year, including shares issuable without additional consideration. Income per share – assuming dilution is calculated by dividing net income by the weighted average number of shares outstanding during the year adjusted for the effect of dilutive potential shares calculated using the treasury stock method.

The reconciliation of basic and diluted income per share are as follows:

	Three Months Ended
	March 31, 2020	March 31, 2019
Net income:
Net income from operations	$50,607	$118,526
Preferred stock dividends	(20,375)	(20,636)
Net income available to common shareholders	30,232	97,890
Basic income per share:
Weighted average common shares outstanding used in income per share	14,539,675	13,741,009
Basic income per share	0.00	0.01
Diluted income per share:
Shares used in diluted income per share	16,501,851	16,248,621
Diluted income per share	0.00	0.01
Computation of shares used in income per share:
Weighted average shares and share equivalents outstanding – basic	14,539,675	13,741,009
Effect of dilutive stock options	1,741,198	2,245,133
Effect of dilutive warrants	220,978	262,479
Weighted average shares and share equivalents outstanding – diluted	16,501,851	16,248,621

Schedule of Anti-dilutive Securities Excluded
	Three Months Ended
	March 31, 2020	March 31, 2019
Stock options	300,000	3,000
Preferred stock	875,054	987,102
Convertible promissory notes	-	27,888
Total anti-dilutive securities excluded	1,175,054	1,017,990

Anti-dilutive securities consist of stock options and convertible promissory notes whose exercise price or conversion price, respectively, was greater than the average market price of the common stock.