On December 31, 2021, Skysong Company issues 139,000 stock-appreciation rights to its officers entitling them to receive cash forthe difference between the market price of its stock and a pre-established price of $11. The fair value of the SARS is estimated to be$5 per SAR on December 31, 2022; $2 on December 31, 2023; $11 on December 31, 2024; and $9 on December 31, 2025. Theservice period is 4 years, and the exercise period is 7 years.(a)Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciationrights plan. (If the compensation decreases from prior year enter the amount as a negative number in the table e.g. -25,000 or (25,000).)Date12/31/2212/31/2312/31/24$Fair Value11Cumulative Compensation Recognizable$11PercentageAccrued% S%%

Given:Service period: 4 yearsExercise period: 7 yearsFirst, let's calculate the total compensation…

Answered: Skysong Company issues 139,000…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 23P

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Monona Company reported net income of 29,975 for 2019. During all of 2019, Monona had 1,000 shares of 10%, 100 par, nonconvertible preferred stock outstanding, on which the years dividends had been paid. At the beginning of 2019, the company had 7,000 shares of common stock outstanding. On April 2, 2019, the company issued another 2,000 shares of common stock so that 9,000 common shares were outstanding at the end of 2019. Common dividends of 17,000 had been paid during 2019. At the end of 2019, the market price per share of common stock was 17.50. Required: 1. Compute Mononas basic earnings per share for 2019. 2. Compute the price/earnings ratio for 2019.
On December 31, 2021, Swifty Company issues 124,000 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 $10. The fair value of the SARS is estimated to be $5 per SAR on December 31, 2022; $2 on December 31, 2023; $10 on December 31, 2024; and $9 on December 31, 2025. The service period is 4 years, and the exercise period is 7 years. (a) 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 e.g.-25,000 or (25,000).) Date Fair Value 12/31/22 $ 12/31/23 12/31/24 12/31/25 Cumulative Compensation Recognizable +A $ Percentage Accrued % % % %
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 e.g. -25,000 or (25,000).) Date 12/31/22 12/31/23 12/31/24 12/31/25 $ Fair Value 4 ||| Cumulative Compensation Recognizable $ 512,000 128,000 1,152,000 896,000 Percentage Accrued 25 % 50 % 75 % 100 % $ $ Compensation Accrued to Date 128,000 256,000 64,000 -64,000 864,000 -800,000…
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On December 31, 2016, Beckford Company issues 150,000 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 $10. The fair value of the SARs is estimated to be $4 per SAR on December 31, 2017; $1 on December 31, 2018; $10 on December 31, 2019; and $9 on December 31, 2020. The service period is 4 years, and the exercise period is 7 years. Instructions a. Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan. b. Prepare the entry at December 31, 2020, to record compensation expense, if any, in 2020. c. Prepare the entry on December 31, 2020, assuming that all 150,000 SARs are exercised.
Ferraro, Inc. established a stock-appreciation rights (SARs) program on January 1, 2020, which entitles executives to receive cash at the date of exercise for the difference between the market price of the stock and the pre-established price of $20 on 5,000 SARs. The required service period is 2 years. The fair value of the SARs are determined to be $4 on December 31, 2020, and $9 on December 31, 2021. Compute Ferraro's compensation expense for 2020 and 2021.
On January 1, 2021, the Apex Company exchanged some shares of common stock it had been holding as an investment for a note receivable. The note principal plus interest is due on January 1, 2022. The 2021 income statement reported $2,200 in interest revenue from this note and a $6,000 gain on sale of investment in stock. The stock’s book value was $16,000. The company’s fiscal year ends on December 31.Required:1. What is the note’s effective interest rate?2. Reconstruct the journal entries to record the sale of the stock on January 1, 2021, and the adjusting entry to record interest revenue at the end of 2021. The company records adjusting entries only at year-end.
E-On January 1, 2020, Orr Co. established a stock appreciation rights plan for its executives. They could receive cash at any time during the next four years equal to the difference between the market price of the common stock and a preestablished price of $16 on 600,000 SARs. The market price is as follows: 12/31/20—$21; 12/31/21—$18; 12/31/22—$19; 12/31/23—$23. On December 31, 2022, 95,000 SARs are exercised, and the remaining SARs are exercised on December 31, 2023. Instructions (a) Prepare a schedule that shows the amount of compensation expense for each of the four years starting with 2020. (b) Prepare the journal entry at 12/31/21 to record compensation expense. (c) Prepare the journal entry at 12/31/23 to record the exercise of the remaining SARs
On December 31, 2020, Pina Company had $1,300,000 of short-term debt in the form of notes payable due February 2, 2021. On January 21, 2021, the company issued 27,500 shares of its common stock for $40 per share, receiving $1,100,000 proceeds after brokerage fees and other costs of issuance. On February 2, 2021, the proceeds from the stock sale, supplemented by an additional $200,000 cash, are used to liquidate the $1,300,000 debt. The December 31, 2020, balance sheet is issued on February 23, 2021. Show how the $1,300,000 of short-term debt should be presented on the December 31, 2020, balance sheet. (Enter account name only and do not provide descriptive information.) Current Liabilities Notes Payable Pina Company Partial Balance Sheet December 31, 2020 $ LA 1,100,000
(Stock-Appreciation Rights) On December 31, 2013, Beckford Company issues 150,000 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 $10. The fair value of the SARs is estimated to be $4 per SAR on December 31, 2014; $1 on December 31, 2015; $10 onDecember 31, 2016; and $9 on December 31, 2017. The service period is 4 years, and the exercise period is 7 years.Instructions(a) Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock appreciation rights plan.(b) Prepare the entry at December 31, 2017, to record compensation expense, if any, in 2017.(c) Prepare the entry on December 31, 2017, assuming that all 150,000 SARs are exercised.
On December 31, 2010, Belmonte Company issues 150,000 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 P10. The fair value of the SARs is estimated to be P4 per SAR on December 31, 2011; P1 on December 31, 2012; P10 on December 31, 2013; and P9 on December 31, 2014. The service period is 4 years, and the exercise period is 7 years. Instructions a. Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan. b. Prepare the entry at December 31, 2014, to record compensation expense, if any, in 2014. c. Prepare the entry on December 31, 2014, assuming that all 150,000 SARs are exercised.
On December 31, 2020, Whispering Company had $ 1,121,000 of short-term debt in the form of notes payable due February 2, 2021. On January 21, 2021, the company issued 23,500 shares of its common stock for $ 46 per share, receiving $ 1,081,000 proceeds after brokerage fees and other costs of issuance. On February 2, 2021, the proceeds from the stock sale, supplemented by an additional $ 40,000 cash, are used to liquidate the $ 1,121,000 debt. The December 31, 2020, balance sheet is issued on February 23, 2021.Show how the $ 1,121,000 of short-term debt should be presented on the December 31, 2020, balance sheet. (Enter account name only and do not provide descriptive information.)

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Skysong Company issues 139,000 stock-appreciation rights to its offi ween the market price of its stock and a pre-established price of $11. The fai cember 31, 2022; $2 on December 31, 2023; $11 on December 31, 2024; an years and the exercic