--- a/taxonomy_menu.module
+++ b/taxonomy_menu.module
@@ -501,7 +501,7 @@ function _taxonomy_menu_save($item) {
     $insert = TRUE;
     $link = array();
   }
-
+
   //create the path.
   //use url to create he inital path
   //we need to remove the first '/' so menu_link_save will work correctly
@@ -790,7 +790,12 @@ function _taxonomy_menu_item($item) {
   //if tid is 0 then do not chagne any settings
   if ($item['tid'] > 0) {
     //get the number of node attached to this term
-    $num = _taxonomy_menu_term_count($item['tid']);
+    if (variable_get('taxonomy_menu_display_descendants_'. $item['vid'], FALSE)) {
+      $num = taxonomy_term_count_nodes($item['tid']);
+    }
+    else {
+      $num = _taxonomy_menu_term_count($item['tid']);
+    }

     //if hide menu is selected and the term count is 0 and the term has no children then do not create the menu item
     if ($num == 0 &&
@@ -803,10 +808,7 @@ function _taxonomy_menu_item($item) {

     //if display number is selected and $num > 0 then change the title
     if (variable_get('taxonomy_menu_display_num_'. $item['vid'], FALSE)) {
-      //if number > 0 and display decendants, then count all of the children
-      if (variable_get('taxonomy_menu_display_descendants_'. $item['vid'], FALSE)) {
-        $num = taxonomy_term_count_nodes($item['tid']);
-      }
+      $num = taxonomy_term_count_nodes($item['tid']);
       $item['name'] .= " ($num)";
     }
   } elseif ($item['tid'] == 0) {