Note 6 - Earnings per share

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted average number of common shares outstanding increased by the effects of assuming that other potentially dilutive securities (such as stock options) outstanding during the period had been exercised and the treasury stock method had been applied. Potentially dilutive securities totaling 812,244 and 1,022,970 for the three months ended July 31, 2017 and 2016, respectively, and 1,104,837 and 1,084,419 for the nine months ended July 31, 2017 and 2016, respectively, were excluded from the calculation of diluted per share amounts because of their anti-dilutive effect.

The following table summarizes the computation of basic and diluted weighted average shares outstanding:

	Three Months Ended July 31,				Nine Months Ended July 31,
	2017		2016		2017		2016

Weighted average shares outstanding for basic earnings per share		8,838,027		8,834,747		8,835,852		8,770,375

Add effects of potentially dilutive securities-assumed exercise of stock options		77,767		-		50,543		-

Weighted average shares outstanding for diluted earnings per share		8,915,794		8,834,747		8,886,395		8,770,375