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Earnings Per Share
 3 Months Ended
Dec. 31, 2014
Earnings Per Share  
Earnings Per Share:

 

5. Earnings Per Share

 

 

 

Three months ended December 31,

 

 

 

2014

 

2013

 

Numerator:

 

 

 

 

 

Net income

 

$
593,742 

 

$
1,008,596 

 

Denominator:

 

 

 

 

 

Basic weighted average shares

 
16,955,726 

 
16,888,086 

 

Dilutive effect of share-based awards

 
84,955 

 
206,260 

 

Diluted weighted average shares

 
17,040,681 

 
17,094,346 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

Basic EPS

 

$
0.04 

 

$
0.06 

 

Diluted EPS

 

$
0.03 

 

$
0.06 

 

 

Earnings per share (“EPS”) are calculated pursuant to FASB ASC Topic 260, Earnings Per Share (“ASC Topic 260”).  Basic EPS excludes potentially dilutive securities and is computed by dividing net income by the weighted average number of common shares outstanding for the period.  Diluted EPS is computed assuming the conversion or exercise of all dilutive securities such as employee stock options.

 

The number of incremental shares from the assumed exercise of stock options is calculated by using the treasury stock method. As of December 31, 2014 and 2013, there were 682,668 and 779,834 options to purchase common stock outstanding, respectively.  The average outstanding diluted shares calculation excludes options with an exercise price that exceeds the average market price of shares during the period.

 

For the three months ended December 31, 2014 and 2013, respectively, 404,380 and 84,598 diluted weighted average shares outstanding were excluded from the computation of diluted EPS because the effect would be anti-dilutive.