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a.
To prepare: The journal entriesrecording of compensation expense over the vesting period.
Giveninformation:
Number of shares as an option is10,000.
Par value of common stock is $2.
Exercise price per share is $18.
Vesting time period is 2 years.
Estimated fair value at the grant date is $250,000
Initial vesting probability is 100%.
b.
To prepare: The journal entries for recording of compensation expense over the vesting period.
Given information:
Number of shares as an option is 10,000.
Par value of common stock is $2.
Exercise price per share is $18.
Vesting time period is 2 years.
Estimated fair value at the grant date is $250,000
Initial vesting probability of year 1 is 100%.
Vesting probability of year 2 is 60%.
c.
The recording of expiration of all options and journal entries related to it.
Given information:
Number of shares as an option is 10,000
Par value of common stock is $2.
Exercise price per share is $18.
Vesting time period is 2 years.
Estimated fair value at the grant date is $250,000
Initial vesting probability of year 1 is 100%.
Vesting probability of year 2 is 60%.
d.
The recording of compensation expense over the vesting period and journal entries.
Given information:
Number of shares as an option is 10,000.
Par value of common stock is $2.
Exercise price per share is $18.
Vesting time period is 2 years.
Estimated fair value at the grant date is $250,000
Initial vesting probability of year 1 is 80%.
Vesting probability of year 2 is 80%.
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Chapter 19 Solutions
Intermediate Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (2nd Edition)
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