Performance-based options : The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options. Journal entry : Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically. Debit and credit rules: Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts. Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts. To journalize : The entry to record the grant of options on January 1, 2016

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Answer 1

Question

Chapter 19, Problem 19.7P

(1)

To determine

Performance-based options: The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The entry to record the grant of options on January 1, 2016

(2)

To determine

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

(3)

To determine

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

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Answer 2

Question

Chapter 19, Problem 19.7P

(1)

To determine

Performance-based options: The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The entry to record the grant of options on January 1, 2016

(2)

To determine

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

(3)

To determine

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

Expert Solution & Answer

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Answer 3

Question

Chapter 19, Problem 19.7P

(1)

To determine

Performance-based options: The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The entry to record the grant of options on January 1, 2016

(2)

To determine

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

(3)

To determine

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

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Answer 4

Question

Chapter 19, Problem 19.7P

(1)

To determine

Performance-based options: The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The entry to record the grant of options on January 1, 2016

(2)

To determine

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

(3)

To determine

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

Expert Solution & Answer

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Answer 5

Chapter 19, Problem 19.7P

(1)

To determine

Performance-based options: The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The entry to record the grant of options on January 1, 2016

(2)

To determine

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

(3)

To determine

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

Answer 6

Chapter 19, Problem 19.7P

(1)

To determine

Performance-based options: The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The entry to record the grant of options on January 1, 2016

Answer 7

Chapter 19, Problem 19.7P

(1)

To determine

Performance-based options: The stock options for which compensation plans are based on the performance targets like divisional revenue, or sales revenue, or earnings per share, are referred to performance-based options.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The entry to record the grant of options on January 1, 2016

Answer 8

(2)

To determine

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

Answer 9

(2)

To determine

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

Answer 10

(3)

To determine

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

Answer 11

(3)

To determine

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 19 - Prob. 19.1Q Ch. 19 - Prob. 19.2Q Ch. 19 - The Tax Code differentiates between qualified...Ch. 19 - Stock option (and other share-based) plans often...Ch. 19 - What is a simple capital structure? How is EPS...Ch. 19 - Prob. 19.6Q Ch. 19 - Blake Distributors had 100,000 common shares...Ch. 19 - Why are preferred dividends deducted from net...Ch. 19 - Prob. 19.9Q Ch. 19 - The treasury stock method is used to incorporate...

To journalize: The entries related to options from December 31, 2016 to December 31, 2019

To prepare: The entries to be journalized 2018 and 2019, if the target is not probable

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Chapter 19 Solutions