Pastner Brands is a calendar-year firm with operations in several countries. As part of its executive compensation plan, at January 1,2024, the company issued 480,000 executive stock options permitting executives to buy 480,000 shares of Pastner stock for $43 pershare. One-fourth of the options vest in each of the next four years beginning at December 31, 2024 (graded vesting). Pastner elects toseparate the total award into four groups (or tranches) according to the year in which they vest and measures the compensation costfor each vesting date as a separate award as given below.Vesting DateDecember 31, 2024December 31, 2025.December 31, 2026December 31, 2027AmountVesting25%25%25%25%Assume Pastner measures the fair value of all options on January 1, 2024, to be $5.40 per option using a single weighted-averageexpected life of the options assumption. Required 1 Required 2Determine the compensation expense related to the options to be recorded each year 2024-2027, assuming Pastner allocatesthe compensation cost for each of the four groups (tranches) separately.Note: Enter your answers in whole dollars.Shares Vesting at:December 31, 2024December 31, 2025December 31, 2026December 31, 2027Total$Required 1 Required 2Compensation expense20240 $Compensation Expense Recorded in:20262027202420250 $0 $202502026$Determine the compensation expense related to the options to be recorded each year 2024-2027, assuming Pastner uses thestraight-line method to allocate the total compensation cost.Note: Enter your answers in whole dollars.Total2027000$00Total

Option vestedFair valueTotal liability to be…

Determine the compensation expense related to the options to be recorded each year 2024-2027, assuming Pastner allocates the compensation cost for each of the four groups (tranches) separately. Note: Enter your answers in whole dollars. Shares Vesting at: December 31, 2024 December 31, 2025 December 31, 2026 December 31, 2027 Total $ 2024 0 $ Compensation Expense Recorded in: 2025 2026 2027 $ 0 $ 0 $ Total 0 0 0 0 0 Required 1 Required 2 Determine the compensation expense related to the options to be recorded each year 2024-2027, assuming Pastner uses the straight-line method to allocate the total compensation cost. Note: Enter your answers in whole dollars.

Determine the compensation expense related to the options to be recorded each year 2024-2027, assuming Pastner allocates the compensation cost for each of the four groups (tranches) separately. Note: Enter your answers in whole dollars. Shares Vesting at: December 31, 2024 December 31, 2025 December 31, 2026 December 31, 2027 Total $ 2024 0 $ Compensation Expense Recorded in: 2025 2026 2027 $ 0 $ 0 $ Total 0 0 0 0 0 Required 1 Required 2 Determine the compensation expense related to the options to be recorded each year 2024-2027, assuming Pastner uses the straight-line method to allocate the total compensation cost. Note: Enter your answers in whole dollars.

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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