On Jan. 1, 2020, Hufflepuff Industries, Inc. issues stock options for 100,000 shares to a regional manager. The options have an estimated fair value of $6 each. The provide additional incentive for the manager's achievement, the options are not exercisable unless the region revenue increase by 8% in three years. Hufflepuff initially estimates that it is probable that the goal will be achieved. How much compensation will be recorded in 2020, 2021, and 2022, the vesting period?

On Jan. 1, 2020, Hufflepuff Industries, Inc. issues stock options for 100,000 shares to a regional manager. The options have an estimated fair value of $6 each. The provide additional incentive for the manager's achievement, the options are not exercisable unless the region revenue increase by 8% in three years. Hufflepuff initially estimates that it is probable that the goal will be achieved. How much compensation will be recorded in 2020, 2021, and 2022, the vesting period?

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter22: S Corporations

Section: Chapter Questions

Problem 14DQ

See similar textbooks

Similar questions

On Jan. 1, 2020, Hufflepuff Industries, Inc. issues stock options for 100,000 shares to a regional manager. The options have an estimated fair value of $6 each. The provide additional incentive for the manager's achievement, the options are not exercisable unless the region revenue increase by 8% in three years. Because the manager when to Ravenclaw College, Hufflepuff initially estimates that the incompetent manager will not achieve the goal. Surprisingly, in year three, the manager meets the 8% increase. How much compensation will be recorded in 2022?
On Jan. 1, 2020, Hufflepuff Industries, Inc. issues stock options for 100,000 shares to a regional manager. The options have an estimated fair value of $6 each. The provide additional incentive for the manager's achievement, the options are not exercisable unless the region revenue increase by 8% in three years. Because the manager when to Ravenclaw College, Hufflepuff initially estimates that the incompetent manager will not achieve the goal. How much compensation will be recorded each year in 2020, 2021, and 2022, the vesting period?
Jack, chief finance officer for sitcom products, convinced the president of the company to enter in to a 90days, forward contract to sell 500,000 kronas as a speculative venture. When the forward contract was acquired on November 1, 2019, the spot rate for the krona was OMR .8041 and the 90days future rate was OMR .8321. At December 31 2019, the end of the firm’s fiscal year, the spot rate was $.9483 and the future rate for kronas to be sold on January 30, 2020, was $.9948. On January 30, 2020, the spot rate was $.9830.Required: Prepare all necessary journal entries in regard to the forward contract.
Jack, chief finance officer for sitcom products, convinced the president of the company to enter in to a 90days, forward contract to sell 500,000 kronas as a speculative venture. When the forward contract was acquired on November 1, 2019, the spot rate for the krona was OMR .8041 and the 90days future rate was OMR .8321. At December 31 2019, the end of the firm's fiscal year, the spot rate was $.9483 and the future rate for kronas to be sold on January 30, 2020, was $.9948. On January 30, 2020, the spot rate was $.9830. Required: Prepare all necessary journal entries in regard to the forward contract.
In January 2021, Continental Fund Services, Inc., enters into a one-year contract with a client to provide investment advisory services. The company will receive a management fee, prepaid at the beginning of the contract, that is calculated as 1% of the client’s $150 million total assets being managed. In addition, the contract specifies that Continental will receive a performance bonus of 20% of any returns in excess of the return on the Dow Jones Industrial Average market index. Continental estimates that it will earn a $2 million performance bonus, but is very uncertain of that estimate, given that the bonus depends on a highly volatile stock market. On what transaction price should Continental base revenue recognition?
In 2022, Blair Corporation paid its CEO base compensation of $700,000 and a performance bonus of $500,000; the CEO was hired in January 2020. How much of the compensation can Blair deduct?
In January 2024, Continental Fund Services, Incorporated, enters into a one-year contract with a client to provide investment advisory services. The company will receive a management fee, prepaid at the beginning of the contract, that is calculated as 1.5% of the client's $310 million total assets being managed. In addition, the contract specifies that Continental will receive a performance bonus of 15% of any returns in excess of the return on the Dow Jones Industrial Average market index. Continental estimates that it will earn a $1.5 million performance bonus, but is very uncertain of that estimate, given that the bonus depends on a highly volatile stock market. On what transaction price should Continental base revenue recognition? Note: Enter your answer in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50). Transaction price million
C&S Marketing (CSM) recently hired a new marketing director, Jeff Otos, for its downtown Minneapolis office. As part of the arrangement, CSM agreed on February 28, 2021, to advance Jeff $40,000 on a one-year, 7 percent note, with interest to be paid at maturity on February 28, 2022. CSM prepares financial statements on June 30 and December 31. Required: Prepare the journal entries that CSM will make: (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations. Round your final answers to whole dollar amount.) 1. When the note is established 2. Prepare the journal entries to accrue interest on June 30 and December 31. 3. to record the principal payment at the maturity date
oreca
C&S Marketing (CSM) recently hired a new marketing director, Jeff Otos, for its downtown Minneapolis office. As part of the arrangement, CSM agreed on February 28, 2021, to advance Jeff $35,000 on a one-year, 7 percent note, with interest to be paid at maturity on February 28, 2022. CSM prepares financial statements on June 30 and December 31. Required: Prepare the journal entries that CSM will make: (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations. Round your final answers to whole dollar amount.) When the note is established To record the interest accruals at each quarter-end and interest payments at each payment date to record the principal payment at the maturity date
On January, 2018 Leni Corp. grants each of its 200 employees in the production department share options. The share options will vest at the end of 2021, provided that the employees remain in the entity's employ and provided that the production increase by at least 50% by 2021. Actual production in 2018 (base year) is 120,000 units. If the production volume increase by an average of 50%-75% by 2021, each employee will receive 20 options each. If production volume inctease by 76% to 100% by 2021, each employee will receive 40 options each. If production volume increase by more than 100% by 2021, each employee will receive 50 options each. Four options plus P120 shall entitle the holder to acquire one ordinary shares (P100 par) at any time up to December 31, 2023. On the grant date, the company estimates that the share options have a fair value of P12 per option. There has been a 20% average increase in annual production for the past three years and that the company expects the same…
In January 2018, Continental Fund Services, Inc., enters into a one-year contract with a client to provide investment advisory services. The company will receive a management fee, prepaid at the beginning of the contract,that is calculated as 1% of the client’s $150 million total assets being managed. In addition, the contract specifiesthat Continental will receive a performance bonus of 20% of any returns in excess of the return on the Dow JonesIndustrial Average market index. Continental estimates that it will earn a $2 million performance bonus, but isvery uncertain of that estimate, given that the bonus depends on a highly volatile stock market. On what transaction price should Continental base revenue recognition?