Homework Help is Here – Start Your Trial Now!
Business
Accounting
How would this affect the statement of stockholders equity for 2021? Please show work I am very confused.

How would this affect the statement of stockholders equity for 2021? Please show work I am very confused.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
answer quickly
On January 1, 2020, the company granted 5 executive employees the option to purchase 450,000 shares (90,000 shares each) of common stock at $120 per share. Under the Black-Scholes option pricing model, total compensation expense is estimated to be $300,000. The option becomes exercisable on January 1, 2023, after the employees complete three years of service. However, on March 31, 2021, two out of the five employees were fired due to poor economic conditions. The market price of the company's stock was $355 on March 31, 2021, and $358 on December 31, 2021. How would this affect the statement of stockholders equity for 2021? Please show work I am very confused.
Transcribed Image Text:On January 1, 2020, the company granted 5 executive employees the option to purchase 450,000 shares (90,000 shares each) of common stock at $120 per share. Under the Black-Scholes option pricing model, total compensation expense is estimated to be $300,000. The option becomes exercisable on January 1, 2023, after the employees complete three years of service. However, on March 31, 2021, two out of the five employees were fired due to poor economic conditions. The market price of the company's stock was $355 on March 31, 2021, and $358 on December 31, 2021. How would this affect the statement of stockholders equity for 2021? Please show work I am very confused.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 1 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS