Quarterly report pursuant to Section 13 or 15(d)

FAIR VALUE DISCLOSURES

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FAIR VALUE DISCLOSURES
 6 Months Ended
Jun. 30, 2012
FAIR VALUE DISCLOSURES [Abstract]  
FAIR VALUE DISCLOSURES
NOTE 8--FAIR VALUE OF FINANCIAL INSTRUMENTS
 
The Company determines the fair values of its financial instruments for disclosure purposes by maximizing the use of observable inputs and minimizing the use of unobservable inputs when measuring fair value. Fair value disclosures for assets and liabilities are grouped in three levels.  The levels prioritize the inputs used to measure the fair value of the assets or liabilities.  These levels are:
 
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Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities.
 
 
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Level 2 – Inputs other than quoted prices that are observable for assets and liabilities, either directly or indirectly.  These inputs include quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are less active.
 
 
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Level 3 – Unobservable inputs that are supported by little or no market activity for assets or liabilities and includes certain pricing models, discounted cash flow methodologies and similar techniques.
 
As of June 30, 2012 and December 31, 2011, the carrying amount for cash and cash equivalents, accounts receivable, accounts payable and borrowings under the Company’s line of credit, which is based on a variable interest rate, approximates their fair value.
 
Cash surrender value of life insurance policies are classified as Level 2.  The fair value of the life insurance policies was determined by the underwriting insurance company’s valuation models and represents the guaranteed value the Company would receive upon surrender of these policies.
 
The Company had no Level 3 financial instruments that are required to be measured at fair value on a nonrecurring basis.  There were no transfers of assets or liabilities between Level 1 and Level 2 in the six month period ended June 30, 2012 or year ended December 31, 2011.