EARNINGS (LOSS) PER SHARE

6 Months Ended

Jun. 30, 2012

Earnings per common share

EARNINGS (LOSS) PER SHARE

NOTE 6. EARNINGS (LOSS) PER SHARE

Basic earnings per share includes no dilution and is computed by dividing income  available to common shareholders by the weighted average number of common shares outstanding for the periods presented. The calculation of basic earnings per share for the six months ended June 30, 2012 includes the weighted average of common shares outstanding.  Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity, such as convertible preferred stock, stock options, warrants or convertible securities.  The calculation of diluted earnings per share for the six months ended June 30, 2012 does not include options to purchase 1,769,869 shares and warrants to purchase 1,065,203 shares due to their anti-dilutive effect.

The following is a reconciliation of the numerator and denominator for basic and diluted earnings per share for the six months ended June 30, 2012 and 2011:

	2012		2011
Basic Earnings per Share
Numerator:
Income  available to common shareholders	$	1,415,248	$	2,606,836
Denominator:
Weighted-average shares outstanding		9,781,851		8,487,392
Basic earnings per share	$	0.14	$	0.31

Diluted Earnings per Share
Numerator:
Income	$	1,415,248	$	2,606,836
Denominator:
Weighted-average shares outstanding		9,781,851		8,487,392
Effect of dilutive securities
Stock options and warrants		1,211,779		822,346
Preferred stock		3,211,328		4,580,161
Diluted weighted-average shares outstanding		14,204,958		13,889,899
Diluted earnings per share	$	0.10	$	0.19