Answer 1
options were granted | January 1, 2021 | ||
Option measurement date | January 1, 2021 |
Answer 2
Options granted | 26 | Millions |
Multiply: Estimated fair value per option | $ 6 | |
fair value of option | $ 156 | Millions |
Divided by: Number of years in vesting period (2021 to 2024) | 3 | Years |
Compensation expense for the stock option plan in 2018. | $ 52 | Millions |
Answer 3
Percentage of option forfeited | 10% | ||
Percentage of option forfeited (100%-10%) | 90% |
Cumulative Compensation expense Up to Year 2022 (156*90%*2/3) | 93.60 | ||
Less: recognized in earlier year (Answer 1) | 52.00 | ||
Compensation expense For Year 2019 | 41.60 | ||
Cumulative Compensation expense Up to Year 2020 (156*90%*3/3) | 140.40 | ||
Less: recognized in earlier year | 93.60 | ||
Compensation expense For Year 2020 | 46.80 |
Date | General journal | debit | Credit |
2019 | Compensation expense | 41.60 | |
Paid in capital – stock options | 41.60 | ||
(To record Compensation expense.) | |||
2020 | Compensation expense | 46.80 | |
Paid in capital – stock options | 46.80 | ||
(To record Compensation expense.) |
Answer 5
Date | General journal | debit | Credit |
July 12, 2022 | Cash (23.4*16) | 374.40 | |
Paid-in capital - stock options (23.4*6) | 140.40 | ||
Common stock (23.4*1) | 23.40 | ||
Paid-in capital – excess of par (Remaining value) | 491.40 | ||
(To record options are exercised.) |
Excisable price = 20*80% | 16 | |
Number of options millions are exercisable = 26-2.6 | 23.4 |
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