On January 1, 2011, Paul Co. granted its CEO, Valerie Paul, 1,000 stock options with an exercise price of $30 per share as compensation. The options vest over four years and expire after 10 years. The stock price on the grant date was $30 and the fair value of the option grant was $10 per share. On December 31, 2012, Paul Co. recorded a journal entry related to this option grant. Which of the following items would be decreased by the December 31, 2012 journal entry? (check all that apply) Net Income Additional Paid in Capital Accumulated Other Comprehensiv Income Cash from Operating Activities Cash from Financing Activities

On January 1, 2011, Paul Co. granted its CEO, Valerie Paul, 1,000 stock options with an exercise price of $30 per share as compensation. The options vest over four years and expire after 10 years. The stock price on the grant date was $30 and the fair value of the option grant was $10 per share. On December 31, 2012, Paul Co. recorded a journal entry related to this option grant. Which of the following items would be decreased by the December 31, 2012 journal entry? (check all that apply) Net Income Additional Paid in Capital Accumulated Other Comprehensiv Income Cash from Operating Activities Cash from Financing Activities

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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On January 1, 2018, VKI Corporation awarded restricted stock units (RSUs) representing 12 million of its $1 parcommon shares to key personnel, subject to forfeiture if employment is terminated within three years. After therecipients of the RSUs satisfy the vesting requirement, the company will distribute the shares. On the grant date,the shares had a market price of $2.50 per share.Required:1. Determine the total compensation cost pertaining to the RSUs.2. Prepare the appropriate journal entry to record the award of RSUs on January 1, 2018.3. Prepare the appropriate journal entry to record compensation expense on December 31, 2018.4. Prepare the appropriate journal entry to record compensation expense on December 31, 2019.5. Prepare the appropriate journal entry to record compensation expense on December 31, 2020.6. Prepare the appropriate journal entry to record the lifting of restrictions on the RSUs and issuing shares atDecember 31, 2020.
Pastore Incorporated granted options for 1 million shares of its $1 par common stock at the beginning of the current year. The exercise price is $31 per share, which was also the market value of the stock on the grant date. The fair value of the options was estimated at $9.00 per option. What would be the total compensation indicated by these options?
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Hanshaben
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