On December 31, 2016, Stellar Company issues 153,000 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 $5 per SAR on December 31, 2017; $2 on December 31, 2018; $9 on December 31, 2019; and $8 on December 31, 2020. 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.
b.
Prepare the entry at December 31, 2016, to record compensation expense, if any, in 2016.
c.
Prepare the entry on December 31, 2016, assuming that all 153,000 SARs are exercised.
On December 31, 2016, Stellar Company issues 153,000 stock-appreciation rights to its officers entitling them to...
On December 31, 2016, Sage 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, 2017; $2 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....
On December 31, 2016, Ayayai Company issues 118,000 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 $11. The fair value of the SARs is estimated to be $5 per SAR on December 31, 2017; $2 on December 31, 2018; $11 on December 31, 2019; and $9 on December 31, 2020. The service period is 4 years, and the exercise period is 7 years....
Exercise 16-29 On December 31, 2013, Marigold Company issues 153,000 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 $5 per SAR on December 31, 2014; $2 on December 31, 2015; $9 on December 31, 2016; and $8 on December 31, 2017. The service period is 4 years, and the exercise period...
On December 31, 2016, Splish Company issues 143,000 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 $5 per SAR on December 31, 2017; $2 on December 31, 2018; $9 on December 31, 2019; and $8 on December 31, 2020. The service period is 4 years, and the exercise period is 7 years....
On December 31, 2013, Blossom Company issues 127,000 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 on December 31, 2016; and $9 on December 31, 2017. The service period is 4 years, and the exercise period is 7 years....
ch. 16.1 #2 On December 31, 2016, Kingbird Company issues 161,000 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 $11. The fair value of the SARS is estimated to be $5 per SAR on December 31, 2017; $2 on December 31, 2018; $11 on December 31, 2019; and $10 on December 31, 2020. The service period is 4 years, and the exercise period...
View Policies Current Attempt in Progress On December 31, 2016, Sarasota 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, 2017 $1 on December 31, 2018; $9 on December 31, 2019, and $7 on December 31, 2020. The service period is 4 years, and...
On December 31, 2016, Carla Company issues 170,000 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 $8. The fair value of the SARs is estimated to be $4 per SAR on December 31, 2017; $1 on December 31, 2018; $8 on December 31, 2019; and $6 on December 31, 2020. The service period is 4 years, and the exercise period is 7 years....
Pina Company establishes a stock-appreciation rights program that entitles its new president Ben Davis to receive cash for the difference between the market price of the stock and a pre-established price of $32 (also market price) on December 31, 2016, on 25,400 SARs. The date of grant is December 31, 2016, and the required employment (service) period is 4 years. President Davis exercises all of the SARs in 2022. The fair value of the SARs is estimated to be $6...
At the end of its fiscal year, December 31, 2020, Cullumber Limited issued 159,000 share appreciation rights to its officers that entitled them to receive cash for the difference between the fair value of its shares and a pre–established price of $10. The fair value fluctuated as follows: December 31, 2021, $13; December 31, 2022, $9; December 31, 2023, $19; and December 31, 2024, $17. An options pricing model determined that the fair value of all 159,000 SARs fluctuated as...