Note 2. Net Income per Share

The Company’s non-vested restricted stock awards contain non-forfeitable rights to dividends and meet the criteria of a participating security as defined by Accounting Standards Codification (“ASC”) Topic 260, “Earnings Per Share”. Under the two-class method, net income per share is computed by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, net income is allocated to both common shares and participating securities based on their respective weighted average shares outstanding for the period.

The following table sets forth the computation of basic and diluted net income per common share under the two-class method for the thirteen weeks ended December 2, 2017 and December 3, 2016, respectively:


	Thirteen Weeks Ended
	December 2,		December 3,
	2017		2016
Net income as reported	$	59,585	$	54,288
Less: Distributed net income available to participating securities		(34)		(77)
Less: Undistributed net income available to participating securities		(69)		(114)
Numerator for basic net income per share:
Undistributed and distributed net income available to common shareholders	$	59,482	$	54,097
Add: Undistributed net income allocated to participating securities		69		114
Less: Undistributed net income reallocated to participating securities		(69)		(114)

Numerator for diluted net income per share:
Undistributed and distributed net income available to common shareholders	$	59,482	$	54,097
Denominator:
Weighted average shares outstanding for basic net income per share		56,287		56,381
Effect of dilutive securities		217		227
Weighted average shares outstanding for diluted net income per share		56,504		56,608
Net income per share Two-class method:
Basic	$	1.06	$	0.96
Diluted	$	1.05	$	0.96

Antidilutive stock options of 957 and 606 were not included in the computation of diluted earnings per share for the thirteen-week periods ended December 2, 2017 and December 3, 2016, respectively.