Question

Allied Paper Products, Inc., offers a restricted stock award plan to its vice presidents. On January 1, 2018, the company granted 22 million of its $1 par common shares, subject to forfeiture if employment is terminated within two years. The common shares have a market price of $7 per share on the grant date. Required: 1. Determine the total compensation cost pertaining to the restricted shares. 2. Prepare the appropriate journal entries related to the restricted stock through December 31, 2019. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the total compensation cost pertaining to the restricted shares. (Enter your answer in millions (i.e., 10,000,000 should be entered as 10).) Total compensation cost million < Required 1 Required 2 >

Answer 1

Total compensation cost million 154 Calculation' Totat Compensation cost Number of reutricted eshares X Market value of harey on guant dlate) d millian x $ per are 154 million (in midlions) Credit Bate Genercal Tournal Debit sec 31,d018 Compensation cxpense $7 Paid-in capital- Restaicted astocR 77 CTo Aciosd compensation expense) Compensation cxpense Paid-in Capital- Restaieted dtock (To Aecond compensetian cxpense) pec 31, Paid -in capital- Restiicted Atock IS4 Bec 31, Common d tock 2019 $ d3 Paid-in Capital- Excess of par To Aecosel isuance of Atoek auard) 车132

Calculation Totou Lompensation cost Vesting Genied Compensation cpense Compensation expense $IS4 million years $ 7 million Dec 31, 2019: Common dto ek= d millian hares x 1 Pare $dd milion Paidt -in Capitat Excen of Par Paiol in capitat Restaicted Common dtock) astock milioun 1S4 million 132 miian