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Help Save & Exit Hua Xin Services offered an incentive stock option plan to its employees. On January 1, 2024, options were granted for 69,000 $1 par common shares. The exercise price equals the $5 market price of the common stock on the grant date. The options cannot be exercised before January 1, 2027, and expire December 31, 2028. Each option has a fair value of $1 based on an option pricing model. Which is the correct entry to record the exercise of 90% the options on April 15, 2027, when the market price of the stock was $8? Multiple Choice Account Title Cash Paid-in capital-stock options Compensation expense Common stock Paid-in capital-excess of par Debit 310,500 Credit 62,100 124,200 62,100 434,700 Account Title Cash Paid-in capital-stock options Common stock Paid-in capital-excess of par Debit 434,700 62,100 Credit 62,100 434,700 Account Title Cash Debit 310,500 Credit Paid-in capital-stock options 62,100 Common stock 69,000 Paid-in capital-excess of par 303,600

Help Save & Exit Hua Xin Services offered an incentive stock option plan to its employees. On January 1, 2024, options were granted for 69,000 $1 par common shares. The exercise price equals the $5 market price of the common stock on the grant date. The options cannot be exercised before January 1, 2027, and expire December 31, 2028. Each option has a fair value of $1 based on an option pricing model. Which is the correct entry to record the exercise of 90% the options on April 15, 2027, when the market price of the stock was $8? Multiple Choice Account Title Cash Paid-in capital-stock options Compensation expense Common stock Paid-in capital-excess of par Debit 310,500 Credit 62,100 124,200 62,100 434,700 Account Title Cash Paid-in capital-stock options Common stock Paid-in capital-excess of par Debit 434,700 62,100 Credit 62,100 434,700 Account Title Cash Debit 310,500 Credit Paid-in capital-stock options 62,100 Common stock 69,000 Paid-in capital-excess of par 303,600

FINANCIAL ACCOUNTING
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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Help Save & Exit Hua Xin Services offered an incentive stock option plan to its employees. On January 1, 2024, options were granted for 69,000 $1 par common shares. The exercise price equals the $5 market price of the common stock on the grant date. The options cannot be exercised before January 1, 2027, and expire December 31, 2028. Each option has a fair value of $1 based on an option pricing model. Which is the correct entry to record the exercise of 90% the options on April 15, 2027, when the market price of the stock was $8? Multiple Choice Account Title Cash Paid-in capital-stock options Compensation expense Common stock Paid-in capital-excess of par Debit 310,500 Credit 62,100 124,200 62,100 434,700 Account Title Cash Paid-in capital-stock options Common stock Paid-in capital-excess of par Debit 434,700 62,100 Credit 62,100 434,700 Account Title Cash Debit 310,500 Credit Paid-in capital-stock options 62,100 Common stock 69,000 Paid-in capital-excess of par 303,600
Transcribed Image Text:Help Save & Exit Hua Xin Services offered an incentive stock option plan to its employees. On January 1, 2024, options were granted for 69,000 $1 par common shares. The exercise price equals the $5 market price of the common stock on the grant date. The options cannot be exercised before January 1, 2027, and expire December 31, 2028. Each option has a fair value of $1 based on an option pricing model. Which is the correct entry to record the exercise of 90% the options on April 15, 2027, when the market price of the stock was $8? Multiple Choice Account Title Cash Paid-in capital-stock options Compensation expense Common stock Paid-in capital-excess of par Debit 310,500 Credit 62,100 124,200 62,100 434,700 Account Title Cash Paid-in capital-stock options Common stock Paid-in capital-excess of par Debit 434,700 62,100 Credit 62,100 434,700 Account Title Cash Debit 310,500 Credit Paid-in capital-stock options 62,100 Common stock 69,000 Paid-in capital-excess of par 303,600
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