Note 3 - Basic and Diluted Shares

9 Months Ended

Sep. 30, 2017

3.	BASIC AND DILUTED SHARES

Basic and diluted weighted-average shares outstanding for the

periods ended

September 30, 2017

and

2016

were as follows:

	Three Months Ended				Nine months Ended
	September 30 ,				September 30 ,
	2017		2016		2017		2016

Basic and diluted		19,022,403		18,914,307		18,983,049		18,935,635
Potentially dilutive		27,500		25,281		27,500		25,281

Basic net income per share is computed by dividing net income by the weighted

-average number of common shares outstanding. Diluted net income per share is computed similar to basic net income per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares from share-based compensation arrangements had been issued.

Potentially dilutive shares arise from non-qualified stock options to purchase common stock and non-vested restricted stock. The treasury stock method is applied to determine the number of potentially dilutive shares for non-vested restricted stock and stock options assuming that the shares of non-vested restricted stock are issued for an amount based on the grant date market price of the shares and that the outstanding stock options are exercised.