On January 1, 2024, Ball Brothers Enterprises (BBE) granted restricted stock units (RSUS) representing 40 million of its $1 par common shares to executives, subject to forfelture if employment is terminated within four years. After the recipients of the RSUS satisfy the vesting requirement, the company will distribute the shares. The common shares had a market price of $10 per share on the grant date. At the date of grant, BBE anticipated that 5% of the recipients would leave the firm prior to vesting. Ignore taxes. Required: 1. Prepare the appropriate Journal entry to record compensation expense on December 31, 2024. 2. Prepare the appropriate journal entry to record compensation expense on December 31, 2025. 3. During 2026, BBE revised its estimate of forfeltures from 5% to 10%. Prepare the appropriate Journal entry to record compensation expense on December 31, 2026. 4. Prepare the appropriate journal entry to record compensation expense on December 31, 2027.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On January 1, 2024, Ball Brothers Enterprises (BBE) granted restricted stock units (RSUS) representing 40 million of its $1 par common
shares to executives, subject to forfelture If employment is terminated within four years. After the recipients of the RSUS satisfy the
vesting requirement, the company will distribute the shares. The common shares had a market price of $10 per share on the grant
date. At the date of grant, BBE anticipated that 5% of the recipients would leave the firm prior to vesting. Ignore taxes.
Required:
1. Prepare the appropriate journal entry to record compensation expense on December 31, 2024.
2. Prepare the appropriate journal entry to record compensation expense on December 31, 2025.
3. During 2026, BBE revised its estimate of forfeltures from 5% to 10%. Prepare the appropriate Journal entry to record
compensation expense on December 31, 2026.
4. Prepare the appropriate journal entry to record compensation expense on December 31, 2027.
Transcribed Image Text:On January 1, 2024, Ball Brothers Enterprises (BBE) granted restricted stock units (RSUS) representing 40 million of its $1 par common shares to executives, subject to forfelture If employment is terminated within four years. After the recipients of the RSUS satisfy the vesting requirement, the company will distribute the shares. The common shares had a market price of $10 per share on the grant date. At the date of grant, BBE anticipated that 5% of the recipients would leave the firm prior to vesting. Ignore taxes. Required: 1. Prepare the appropriate journal entry to record compensation expense on December 31, 2024. 2. Prepare the appropriate journal entry to record compensation expense on December 31, 2025. 3. During 2026, BBE revised its estimate of forfeltures from 5% to 10%. Prepare the appropriate Journal entry to record compensation expense on December 31, 2026. 4. Prepare the appropriate journal entry to record compensation expense on December 31, 2027.
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