3,000 shares of the On January 1, 2021, Wildhorse Inc. granted stock options to officers and key employees for the purchas company's $10 par common stock at $25 per share. The options were exercisable within a 5-year period beginning January 1, 2023, by grantees still in the employ of the company, and expiring December 31, 2027. The service period for this award is 2 years. Assume that the fair value option-pricing model determines total compensation expense to be $330,600. On April 1, 2022, 2,300 options were terminated when the employees resigned from the company. The market price of the common stock was $36 per share on this date. On March 31, 2023, 13,800 options were exercised when the market price of the common stock was $39 per share. Prepare journal entries to record issuance of the stock options, termination of the stock options, exercise of the stock options, and charges to compensation expense, for the years ended December 31, 2021, 2022, and 2023. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

3,000 shares of the On January 1, 2021, Wildhorse Inc. granted stock options to officers and key employees for the purchas company's $10 par common stock at $25 per share. The options were exercisable within a 5-year period beginning January 1, 2023, by grantees still in the employ of the company, and expiring December 31, 2027. The service period for this award is 2 years. Assume that the fair value option-pricing model determines total compensation expense to be $330,600. On April 1, 2022, 2,300 options were terminated when the employees resigned from the company. The market price of the common stock was $36 per share on this date. On March 31, 2023, 13,800 options were exercised when the market price of the common stock was $39 per share. Prepare journal entries to record issuance of the stock options, termination of the stock options, exercise of the stock options, and charges to compensation expense, for the years ended December 31, 2021, 2022, and 2023. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On January 1, 2020 share options were granted to employees where they can purchase 100,000 ordinary shares of P80 par value at P100 per share. The fair value of the share options on this date was P25 per share. The officers are entitled to the share options only after completing two years of service. The options can be exercised starting January 1, 2022 and shall expire on December 31, 2022. The amount of compensation expense to be reported in 2020 is a. P0 b. P1,250,000 c. P2,500,000 d. P8,000,000 Norie Company leased an asset on a finance lease. The present value of the lease payments total P686,000 and the fair value of the asset is P750,000. The asset has a useful life of 5 years and the lease term is 4 years. The bargain purchase option for the asset at the end of its useful life is nominal and is substantially lower than the value of the asset at that date. Depreciation for the asset is computed using straight line method. How much is the annual…
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On January 1, 2021, an entity granted to employees 10,000 share options. On January 1, 2022, the entity granted to employees an additional 20,000 share options. Date January 1, 2021 December 31, 2021 January 1, 2022 December 31, 2022 Fair value of share 20 22 25 30 The shares vest at the end of a four-year period. There are no forfeitures. What amount should be recorded as compensation expense for 2022?
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On January 1, 2020, AllClear Company issues 2,000 shares of restricted stock to its CEO, Jason Skyline. AllClear’s stock has a fair value of $30 per share on January 1, 2020. Additional information is as follows. The service period related to the restricted stock is five years. Vesting occurs if Skyline stays with the company for a five-year period. The par value of the stock is $10 per share. Prepare journal entries relating to the restricted stock in 2020. Assume that Jason Skyline leaves the company on April 1, 2021 (before any expense has been recorded during 2021). Prepare journal entry relating to the restricted stock in 2021, if necessary.
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On January 1,2019, an entity granted to a senior officer the right to choose either - 10,000, P 24 par ordinary shares or- cash payment equal to 7,500 shares of P 24 par ordinary sharesThe grant is conditional upon the completion of three years of service. If the senior officer chooses the share alternative, the shares must be held for three years after the vesting date.On January 1,2019, the price per ordinary share is P 50. The ordinary share prices for the three- year vesting period are:December 31,2019- P 53December 31,2020- P 58December 31,2021- P 62After taking into account the effects of post vesting restrictions, the entity had estimated that the fair value of the share alternative is P 49 per share. required:(a)What is the compensation expense for 2019 relating to the cash alternative? (b)What is the compensation expense for 2020 relating to the equity alternative? (c)Assuming on June 30,2022, the senior officer opted for a cash alternative, how much is the compensation…
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