DaBaby Company issues 4,000 shares of restricted stock to its CFO, Stallion Megan, on January 1, 2020. The stock has a fair value of $120,000 on this date. The service period related to this restricted stock is 5 years. Vesting occurs if Fierce stays with th company for 5 years. The par value of the stock is $5. At December 31, 2021, the fai value of the stock is $135,000. On January 3, 2023, Megan leaves the company Prepare the journal entry to account for this forfeiture. O Common Stock 20,000 Paid-in-Capital in excess of par Common Stock 100,000 Unearned Compensation 48,000 Compensation Expense 72,000 O Common Stock 120,000O Unearned Compensation 72,000 Compensation Expense 48,000 O Unearned Compensation 120,000 Common Stock 20,000 Paid-in-Capital in excess of par - Common Stock 100,000 O Common Stock 20,000 Paid-in-Capital in excess of par Common Stock 100,000 Unearned Compensation 72,000 Compensation Expense 48,000

DaBaby Company issues 4,000 shares of restricted stock to its CFO, Stallion Megan, on January 1, 2020. The stock has a fair value of $120,000 on this date. The service period related to this restricted stock is 5 years. Vesting occurs if Fierce stays with th company for 5 years. The par value of the stock is $5. At December 31, 2021, the fai value of the stock is $135,000. On January 3, 2023, Megan leaves the company Prepare the journal entry to account for this forfeiture. O Common Stock 20,000 Paid-in-Capital in excess of par Common Stock 100,000 Unearned Compensation 48,000 Compensation Expense 72,000 O Common Stock 120,000O Unearned Compensation 72,000 Compensation Expense 48,000 O Unearned Compensation 120,000 Common Stock 20,000 Paid-in-Capital in excess of par - Common Stock 100,000 O Common Stock 20,000 Paid-in-Capital in excess of par Common Stock 100,000 Unearned Compensation 72,000 Compensation Expense 48,000

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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On January 1, 2020 Sams Company granted Jim Norman, an employee, an option to buy 300 shares of Sams stock for $40 per share. The option is exercisable for 5 years from date of grant. Using a fair value option pricing model, total compensation expense is determined to be $4,800. The market value for each share of stock is $55 a share. The service period for the stock compensation is for two years beginning January 1, 2020. Record the journal entries for 2020 and 2021.
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.
On December 31, 2016, Ferris Corporation granted 10,000 shares of its $1 par value common stock to its employees. The shares are restricted until 2 years of employment is completed (December 31, 2018). Market price of the common stock on that date of grant was $40 per share. Assume that 10 percent of the employees left (before vesting) on January 1, 2018, and 90 percent of the employees completed the vesting requirements on December 31, 2018. Use the Common Stock (Restricted) and the Deferred Compensation accounts as illustrated in the homework. 1. The journal entry to record the recognition of compensation expense on December 31, 2017 2. The journal entry on January 1, 2018 to record the forfeiture on 10 percent of the restricted shares (because the employees did not stay until vested) 3. The journal entries on December 31, 2018 to (1) recognize the remaining compensation expense, and (2) to award the restricted stock to the 90 percent of the employees who vested.
On January 1, 2021, Summer Fashions Corp. awarded restricted stock units (RSUS) representing 5 million of its $1 par common shares to key personnel, subject to forfeiture if employment is terminated within three years. After the recipients of the RSUS satisfy the vesting requirement, the company will distribute the shares. On the grant date, the shares had a market price of $9.00 per share. The journal entry to record the lifting of restrictions on the RSUS and issuing shares at December 31, 2023, would include a: O Credit to Paid-in capital - restricted stock $45 million O None of the options listed. O Credit to Paid-in capital - restricted stock $15 million O Debit to Paid-in capital - restricted stock $45 million O Debit to Paid-in capital - restricted stock $15 million • Previous
Isadore Bell Company granted 8 million of its no par common shares to executives, subject to forfeiture if employment is terminated within three years. The common shares have a market price of $3 per share on January 1, 2021, the grant date. When calculating diluted EPS at December 31, 2022, what will be the net increase in the denominator of the EPS fraction if the market price of the common shares averaged $4 per share during 2022?
On July 1, 2024, Flounder Company adopted a stock option plan that granted options to key executives to purchase 112,000 shares of the company's $1 par value common stock. The options were granted on January 1, 2025, and were exercisable 3 years after the date of grant if the grantee was still an employee of the company. The options expired 4 years from date of grant. The option price was set at $69, and the fair value option pricing model determines the total compensation expense to be $660,000. All of the options were exercised February 1, 2028, when the market price was $77 a share. Prepare journal entries relating to the stock option plan for the years 2024 through 2028. Assume that the employee performs services equally in 2025, 2026 and 2027. (Credit account titles are automatically indented when amount is entered. Do not incent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. List all debit entries before credit entries.…
On January 2, 2020, Theodora Company purchased 40,000 shares of Byzantine, Inc. stock at P100 per share. Brokerage fees amounted to P120,000. A P5 dividend per share of Byzantine, Inc. shares had been declared on December 15, 2019, to be paid on March 31, 2020 to shareholders of record on January 31, 2020. The shares are designated as FVTOCI. On December 31, 2020 the investment has a fair value of P4.200.000. How much should be recognized in the 2020 other comprehensive income related to these securities? A. 80,000 B. 200,000 C. 280,000 D. 400,000
On January 2, 2020, Theodora Company purchased40,000 shares of Byzantine, Inc. stock at P100 per share. Brokerage fees amounted to P120,000. A P5 dividend per share of Byzantine, Inc. shares had been declared on December 15, 2019, to be paid on March 31, 2020 to shareholders of record on January 31, 2020. The shares are designated as FVTOCI. On December 31, 2020 the investment has a fair value of P4,200,000. How much should be recognized in the 2020 other comprehensive income related to these securities?a. P400,000 c. P200,000b. P280,000 d. P 80,000
On June 30, 2020, Kikyo Company granted compensatory share options for 48,000 P20 par value ordinary shares to certain key employees. The market price of the share on that date was P36 and the option price was P30. The Black-Scholes option pricing model measured the total compensation expense to be PS,100,000. The options are exercisable beginning January 1, 2023, provided the key employees are still in entity's employ at the time the options are exercised. The options expire on June 30, 2024. On January 15, 2023, when the market price of the share was P42, all 48,000 options were exercised. What is the compensation expense for 2022?
Under its stock option plan, Ameri Corp. granted 3 million stock options to employees on January 1, 2021. The fair value of each option is $5 and no forfeitures are anticipated. Each option permits an employee to purchase one share of $1 par common stock within the next six years, but not before December 31, 2023 (the vesting date), at an exercise price of $12 per share (the market price of the shares on the grant date). On April 3, 2024, all options are exercised when the market price is $35 per share. The journal entry Ameri would record on April 3, 2024 would include: Multiple Choice a debit to Cash for $105,000,000. a debit to Paid-in capital-stock options for $5,000,000. a debit to Compensation Expense for $15,000,000. a credit to Paid-in capital-excess of par for $48,000,000.
On January 1, 2020, Prospero Games Inc. granted stock options to managers and key employees under which the managers and employees could purchase shares of the company for $35. Prospero set aside 40,000 shares for this purpose. The options are exercisable within a four-year period beginning January 1, 2022 by employees still with the company, and the options expire on December 31, 2025. The estimated value of the options on January 1, 2020 is $4.50 per share. On January 10, 2022, 16,000 of the options were exercised when the stock price was $44. On December 17, 2022, an additional 10,000 of the options were exercised when the stock price was $48. No further stock options were exercised. Required: Prepare all the journal entries required between January 1, 2020 and December 31, 2025.
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