On December 31, 2021, Coronado Company issues 128,000 stock-appreciation rights to its officers entitling them to receive cash for the difference between the market price of its stock and a pre-established price of $9. The fair value of the SARS is estimated to be $4 per SAR on December 31, 2022: $1 on December 31, 2023: $9 on December 31, 2024; and $7 on December 31, 2025. The service period is 4 years, and the exercise period is 7 years. (a) - Your answer is partially correct. Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan. (If the compensation decreases from prior year enter the amount as a negative number in the table eg -25,000 or (25,000)) Date 12/31/22 12/31/23 12/31/24 12/31/25 $ Fair Value 4 Cumulative Compensation Recognizable $ $12,000 128.000 1.152.000 896,000 Percentage Accrued 25 50 % 75 % 100 % Compensation Accrued to Date $ POHONGO COTOTO 128.000 256,000 64,000 -64,000 864,000 -800,000 64,000 Expense 2022 $ 128.000 Expense 2023 256,000 Expense 2024 0.0.0. -64,000 $ Expense 2025 TOTOO 800,000

On December 31, 2021, Coronado Company issues 128,000 stock-appreciation rights to its officers entitling them to receive cash for the difference between the market price of its stock and a pre-established price of $9. The fair value of the SARS is estimated to be $4 per SAR on December 31, 2022: $1 on December 31, 2023: $9 on December 31, 2024; and $7 on December 31, 2025. The service period is 4 years, and the exercise period is 7 years. (a) - Your answer is partially correct. Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan. (If the compensation decreases from prior year enter the amount as a negative number in the table eg -25,000 or (25,000)) Date 12/31/22 12/31/23 12/31/24 12/31/25 $ Fair Value 4 Cumulative Compensation Recognizable $ $12,000 128.000 1.152.000 896,000 Percentage Accrued 25 50 % 75 % 100 % Compensation Accrued to Date $ POHONGO COTOTO 128.000 256,000 64,000 -64,000 864,000 -800,000 64,000 Expense 2022 $ 128.000 Expense 2023 256,000 Expense 2024 0.0.0. -64,000 $ Expense 2025 TOTOO 800,000

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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