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Now assume that the market price of Amazon stock on the grant date was $43 per share. Prepare the journal entries for the first year of the stock-option plan. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record entries in the order displayed in the problem statement.)

Now assume that the market price of Amazon stock on the grant date was $43 per share. Prepare the journal entries for the first year of the stock-option plan. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record entries in the order displayed in the problem statement.)

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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Now assume that the market price of Amazon stock the grant date was $43 per share. Prepare the journal entries for the first year of the stock-option plan. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record entries in the order displayed in the problem statement.) Date 1/1/25 12/31/25 Account Titles and Explanation Unearned Compensation Common Stock Compensation Expense Unearned Compensation Debit 36,980 7,396 Credit 36.
Transcribed Image Text:Now assume that the market price of Amazon stock the grant date was $43 per share. Prepare the journal entries for the first year of the stock-option plan. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record entries in the order displayed in the problem statement.) Date 1/1/25 12/31/25 Account Titles and Explanation Unearned Compensation Common Stock Compensation Expense Unearned Compensation Debit 36,980 7,396 Credit 36.
Assume that Amazon.com has a stock-option plan for top management. Each stock option represents the right to purchase a share of Amazon $1 par value common stock in the future at a price equal to the fair value of the stock at the date of the grant. Amazon has 5,300 stock options outstanding, which were granted at the beginning of 2025. The following data relate to the option grant. Exercise price for options Market price at grant date (January 1, 2025) Fair value of options at grant date (January 1, 2025) Service period $42 $42 $6 5 years
Transcribed Image Text:Assume that Amazon.com has a stock-option plan for top management. Each stock option represents the right to purchase a share of Amazon $1 par value common stock in the future at a price equal to the fair value of the stock at the date of the grant. Amazon has 5,300 stock options outstanding, which were granted at the beginning of 2025. The following data relate to the option grant. Exercise price for options Market price at grant date (January 1, 2025) Fair value of options at grant date (January 1, 2025) Service period $42 $42 $6 5 years
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