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6. Earnings Per Share

9 Months Ended

Sep. 30, 2018

6. Earnings per Share

Basic and diluted earnings (loss) per share are calculated by dividing net income (loss) by the weighted average number of common shares outstanding–basic and diluted, respectively. The calculation of the weighted average number of common shares outstanding–diluted includes the following common stock equivalents:

	September 30, 2018				September 30, 2017
	Three Months		Nine Months		Three Months		Nine Months

Stock options		-		7,054,500		2,750,000		3,250,000
Stock purchase warrants		-		1,200,000		1,200,000		1,200,000
Total		-		8,254,500		3,950,000		4,450,000

For the three month period ending September 30, 2018, all outstanding stock options and warrants were excluded from the computation of diluted loss per share, as net loss for that period would cause their inclusion to have an antidilutive effect on the calculation of loss per share.

Excluded from the diluted earnings per share calculations for the nine months ending September 30, 2018 were 12,525,123 warrants. These warrants were excluded because the exercise prices were greater than the average trading prices of the Company’s common stock for the periods.

Excluded from the diluted earnings per share calculations for both the three and nine months ending September 30, 2017 were 2,725,000 stock options and 6,387,500 warrants. These stock options and warrants were excluded because the exercise prices were greater than the average trading prices of the Company’s common stock for the periods.