Earnings Per Share

6 Months Ended

Jun. 30, 2015

Note 2.

Earnings per Share.

We present basic and diluted earnings or loss per share in accordance with authoritative guidance which establishes standards for computing and presenting basic and diluted earnings per share. Per share data is determined by using the weighted average number of common shares outstanding. Common equivalent shares are considered only for diluted earnings per share, unless considered anti-dilutive. Common equivalent shares, determined using the treasury stock method, result from stock options with exercise prices that are below the average market price of the common stock.

Basic earnings per share include no dilution and are computed by dividing income available to common shareholders by the weighted-average number of shares outstanding during the period. Diluted earnings per share reflect the potential of securities that could share in our earnings. There were common stock equivalents of 397,500 and 110,000 shares outstanding at June 30, 2015 and 2014, respectively, consisting of stock options that were not included in the calculation of earnings per share because they would have been anti-dilutive.

A reconciliation of the weighted average number of common shares outstanding for the three and six months ended June 30, 2015 and 2014 is as follows:

	2015
	Three Months		Six Months
Common shares outstanding, beginning of the period		11,576,539		11,549,789
Weighted average common shares issued		52,210		43,423
Weighted average number of common shares outstanding		11,628,749		11,593,212
Dilutive effect of common share equivalents		288,894		305,377
Diluted weighted average number of common shares outstanding		11,917,643		11,898,589

	2014
	Three Months		Six Months
Common shares outstanding, beginning of the period		11,446,800		11,446,800
Weighted average common shares issued		53,823		28,036
Weighted average number of common shares outstanding		11,500,623		11,474,836
Dilutive effect of common share equivalents		293,705		298,250
Diluted weighted average number of common shares outstanding		11,794,328		11,773,086

We have authorized 20,000,000 shares of preferred stock issuable in one or more series, none of which is issued or outstanding as of June 30, 2015.