39On January 3 of Year 1, a company's shareholders vote to approve the issuance f stock options to an executive with an expected benefit period of three years, ending on December 31 of Year 3. On April 1 of Year 1, the company grants the options which may beexercised any time for a period of five years. The company uses the fair value method, and the executive exercises the stock options on October 1 of Year 3.On which date is the fair value amount used to calculate the company's compensation expense for this executive?O October 1 of Year 3April 1 of Year 1O December 31 of Year 3O January 3 of Year 1NEXT >BOOKMARK

Stock options: Stock options are the stock-based compensation plans provided in the form of an…

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On which date is the fair value amount used to calculate the company's compensation expense for this executive?

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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Question

39
On January 3 of Year 1, a company's shareholders vote to approve the issuance f stock options to an executive with an expected benefit period of three years, ending on December 31 of Year 3. On April 1 of Year 1, the company grants the options which may be
exercised any time for a period of five years. The company uses the fair value method, and the executive exercises the stock options on October 1 of Year 3.
On which date is the fair value amount used to calculate the company's compensation expense for this executive?
O October 1 of Year 3
April 1 of Year 1
O December 31 of Year 3
O January 3 of Year 1
NEXT >
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