Note 7 - Earnings (Loss) Per Share

12 Months Ended

Dec. 31, 2014

Notes to Financial Statements

Earnings Per Share [Text Block]

Note 7 – Earnings (Loss) Per Share

For periods with net income, net income per common share information is computed using the two-class method. Under the two-class method, basic net income per common share is computed by dividing the net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. No such adjustment to earnings is made during periods with a net loss, as the holders of the convertible preferred shares have no obligation to fund losses.

The Company’s calculation of earnings per share is as follows:

	2014			2013
Basic earnings per common share:
Net income (loss) applicable to common shareholders – basic	$	533,428		$	(147,482	)
Portion allocable to common shareholders		99.2	%		100.0	%
Net income allocable to common shareholders		529,161			(147,482	)
Weighted average basic shares outstanding		31,906,572			31,843,704
Basic earnings per share	$	0.02		$	-
Dilutive earnings per common share:
Net income allocable to common shareholders		529,161			(147,482	)
Add: undistributed earnings allocated to participating securities		4,267			-
Numerator for diluted earnings per common share		533,428			(147,482	)
Weighted average basic shares outstanding		31,906,572			31,843,704
Diluted effect:
Stock options		28,000			-
Unvested restricted stock awards		15,714
Conversion equivalent of dilutive Series B Convertible Preferred Stock		3,307,299			-
Conversion equivalent of dilutive Convertible Preferred Stock		255,000			-
Weighted average dilutive shares outstanding		35,512,585			31,843,704
Dilutive earnings per share	$	0.02		$	-

The table below sets forth the calculation of the percentage of net earnings (loss) allocable to common shareholders under the two-class method:

	2014			2013
Numerator:
Weighted average participating common shares		31,906,572			31,843,704
Denominator:
Weighted average participating common shares		31,906,572			31,843,704
Add: Weighted average shares of Convertible Preferred Stock		255,000			-
Weighted average participating shares		32,161,572			31,843,704
Portion allocable to common shareholders		99.2	%		100.0	%

Diluted earnings (loss) per share for the years ended December 31, 2014 and 2013 do not reflect following potential common shares, as the effect would be antidilutive.

	Years Ended December 31,
	201 4		201 3
Stock options		610,000		645,000
Unvested restricted stock awards		-		103,000
Convertible preferred stock		-		3,562,299
Total		610,000		4,310,299