A supervisory employee is a recipient of a stock option which vested during the year. The following data pertains to the exercise of the optlon and its subsequent sale by the employee: Value of stocks at vesting date P45,000 Exercise price of option 30,000 Selling price of stocks 50,000 How much shall be the supplemental compensation of the employee which will be added to his regular compensation and will be subject to the regular income tax? O Zero O 5,000 O 15,000 O 20,000

A supervisory employee is a recipient of a stock option which vested during the year. The following data pertains to the exercise of the optlon and its subsequent sale by the employee: Value of stocks at vesting date P45,000 Exercise price of option 30,000 Selling price of stocks 50,000 How much shall be the supplemental compensation of the employee which will be added to his regular compensation and will be subject to the regular income tax? O Zero O 5,000 O 15,000 O 20,000

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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In 2020, a public Canadian corporation grants an employee an option to purchase 5,000 shares for $75 a share when the shares were trading for $74. The employee exercises the option in 2020 when the shares were trading for $79 a share. In 2021, all the shares were sold when they were trading for $85 a share. What is the impact on 2020 Division B (Net Income) and Division C (Taxable Income)? O 12,500 increase in Division B and Division C O 25,000 increase in Division B and 12,500 increase in Division C 10,000 increase in Division B and Division C 20,000 increase in Division B and 10,000 increase in Division C
Company A has issued stock options to an employee that vest based on only continued service in installments. The employee was granted 300 options, 100 vest if the employee continues in service for one year, a further 100 vest after two years and the final 100 vest after three years. The fair value of the options is $9 per share. The company has determined that the service period for purposes of attributing the expense to the period of service is three years. What would be the amortization expense in the second year of the arrangement under IFRS? a. $900 b $1,650 c. $1,800 d. $750
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Required information [The following information applies to the questions displayed below.] On January 1, year 1, Tyra started working for Hatch Corporation. New employees must choose immediately between receiving 7 NQOs (each NQO provides the right to purchase for $5 per share 10 shares of Hatch stock) or 50 restricted shares. Hatch's stock price is $5 on Tyra's start date. Either form of equity-based compensation will vest in two years. Tyra believes that the stock will be worth $15 per share in two years and $25 in four years when she will sell the stock. Tyra's marginal tax rate is 32 percent and her long-term capital gains rate is 15 percent. Assuming that Tyra's price predictions are correct, answer the following questions (ignore present value, and use nominal dollars): (List cash outflows as negative amounts. Leave no answers blank. Enter zero if applicable.) c. What are the cash-flow effects to Tyra in the year she receives the restricted stock, in the year the stock vests, and…
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The following information relates to the pension plan for the employees of RR Co.: 1/1/19 12/31/19 12/31/20 Defined benefit obligation P5,580,000 P5,976,000 P8,004,000 Fair value of plan assets 5,100,000 6,240,000 6,888,000 Net (gain) or loss 0 (164,000) (96,000) Discount rate (for year) 11% 11% RR estimates that the average remaining service life is 16 years. RR's contribution was P756,000 in 2020 and benefits paid were P564,000. The actual return on plan assets in 2020 is?