Net (Loss) Income Per Common Share

3 Months Ended

Mar. 31, 2012

3. Net (Loss) Income Per Common Share

Basic net (loss) income per common share is computed by dividing net (loss) income available to common stockholders by the weighted average number of common shares outstanding during each period. Diluted net (loss) income per common share reflects the maximum dilution, based on the average price of the Company’s common stock during each period, and is computed similar to basic net (loss) income per common share except that the denominator is increased to include the number of additional shares that would have been outstanding if potentially dilutive stock options had been exercised.

Basic and diluted net (loss) income per share are as follows:

	For the Three Months Ended March 31,
	2012			2011
BASIC EPS
Net (loss) income	$	(811,726	)	$	292,367
Weighted average common shares outstanding	14,317,006			14,866,238
Basic net (loss) income per share	$	(0.06	)	$	0.02

DILUTED EPS
Net (loss) income	$	(811,726	)	$	292,367
Weighted average common shares outstanding	14,317,006			14,866,238
Dilutive common equivalent shares outstanding:
Options	—			1,018,097
Restricted stock	—			—
Total diluted potential common shares	14,317,006			15,884,335
Diluted net (loss) income per share	$	(0.06	)	$	0.02

For the three months ended March 31, 2012 and 2011, there were outstanding options and restricted stock to purchase an aggregate of 5,038,517 shares and 1,214,420 shares, respectively, of the Company’s common stock that were not included in the computation of dilutive net (loss) income per share above because they would be anti-dilutive.

- Definition

The entire disclosure for earnings per share.

+ References+ Details

SRS LABS INC 10-Q