On November 1, 2017, Metlock Company adopted a stock-option plan
that granted options to key executives to purchase 33,900 shares of
the company’s $10 par value common stock. The options were granted
on January 2, 2018, and were exercisable 2 years after the date of
grant if the grantee was still an employee of the company. The
options expired 6 years from date of grant. The option price was
set at $30, and the fair value option-pricing model determines the
total compensation expense to be $508,500.
All of the options were exercised during the year 2020: 22,600 on
January 3 when the market price was $67, and 11,300 on May 1 when
the market price was $77 a share.
Prepare journal entries relating to the stock option plan for the
years 2018, 2019, and 2020. Assume that the employee performs
services equally in 2018 and 2019. (Credit account
titles are automatically indented when amount is entered. Do not
indent manually. If no entry is required, select "No Entry" for the
account titles and enter 0 for the amounts. Round intermediate
calculations to 5 decimal places, e.g. 1.24687 and final answers to
0 decimal places, e.g. 5,125.)
On November 1, 2017, Metlock Company adopted a stock-option plan that granted options to key executives...
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