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Average Common Shares Outstanding Used to Compute Earnings Per Share
6 Months Ended
Jun. 30, 2011
Average Common Shares Outstanding Used to Compute Earnings Per Share  
Average Common Shares Outstanding Used to Compute Earnings Per Share

3.     Average Common Shares Outstanding Used to Compute Earnings Per Share

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2011

 

2010

 

2011

 

2010

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

18,528,213

 

8,093,326

 

18,522,263

 

8,086,243

 

Potentially dilutive

 

321,661

 

1,333,333

 

322,282

 

1,333,333

 

 

Basic earnings (loss) per share is computed by dividing net income or loss by the weighted-average number of common shares outstanding. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares from share-based compensation arrangements had been issued.

 

Potentially dilutive shares arise from non-qualified stock options to purchase common stock, non-vested restricted stock and common stock issuable upon assumed conversion of convertible debt (fully repaid in August 2010). The treasury stock method is applied to determine the number of potentially dilutive shares for nonvested restricted stock and stock options assuming that the shares of nonvested restricted stock are issued for an amount based on the grant date market price of the shares and that the outstanding stock options are exercised. Convertible debt is assumed to be converted by applying the if-converted method. These amounts were excluded because the effect would be anti-dilutive.