Basic and Diluted Earnings (Loss) per Share

6 Months Ended

Jun. 30, 2011

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

4.           Basic and Diluted Earnings (Loss) per Share

The basic earnings (loss) per share is computed by dividing the earnings (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period.  Basic net earnings (loss) per share exclude the dilutive effect of our convertible notes.  If operations result in net loss for any period, diluted net loss per share would be the same as basic net loss per share, since the effect of any potentially dilutive securities would be anti-dilutive. Therefore, the conversion of the related party notes has been excluded from the calculation of net loss per share for the three and six months ended June 30, 2010. The computations for basic and dilutive net loss per share are as follows:

	Three months ended					Six months ended
	6/30/2011		6/30/2010			6/30/2011		6/30/2010
Net income (loss)	$	205,400		(25,700	)	$	176,100		(443,000	)
Weighted average common shares outstanding		12,427,262		12,427,262			12,427,262		12,427,262
Basic net income (loss) per share	$	0.02		(0.00	)	$	0.01		(0.04	)
Interest expense on convertible notes	$	22,700		—		$	45,100		—
Income for computing diluted net income (loss) per share	$	228,100		(25,700	)	$	221,200		(443,000	)
Incremental shares from assumed exercise of dilutive securities		2,179,911		—			2,179,911		—
Dilutive potential common shares		14,607,173		12,427,262			14,607,173		12,427,262
Diluted net earnings per share	$	0.02		(0.00	)	$	0.02		(0.04	)

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the US includes having the Company make estimates and assumptions affecting the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities. The amounts estimated could differ from actual results. Significant estimates include the allowance for bad debts, depreciation and amortization periods, and the future utilization of deferred tax assets.