at-the-money stock options to its management c 2026. Windy Lake's share price was $10 on the the fair value of the options showed that they we e. On the vesting date, management exercised all end. gany entry required at December 31, 2023
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- On November 1, 2025, Kingbird Company adopted a stock-option plan that granted options to key executives to purchase 25,500 shares of the company's 59 par value common stock. The options were granted on January 2, 2026, 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 $50, and the fair value option-pricing model determines the total compensation expense to be $382.500. All of the options were exercised during the year 2028: 17,000 on January 3 when the market price was $65, and 8,500 on May 1 when the market price was $76 a share. Prepare journal entries relating to the stock option plan for the years 2026, 2027, and 2028. Assume that the employee performs services equally in 2026 and 2027. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is…On January 1,2020, V Co. issued 100 share options to each of its 15 executive officers. The options vest at the end of a 4-year period. On the date of grant, each share option had a fair value of P 10. V expects that all 1,500 options will vest. After the 4 year period, all executives are still in the employ of V Co. and 7 executives exercised their option and purchased the shares for P 17 each. The par value of each share is P 15. How much is credited to the share premium account if 7 of the executives exercised their share options?On January 1,2020, V Co. issued 100 share options to each of its 15 executive officers. The options vest at the end of a 4-year period. On the date of grant, each share option had a fair value of P 10. V expects that all 1,500 options will vest. After the 4 year period, all executives are still in the employ of V Co. and 7 executives exercised their option and purchased the shares for P 17 each. The par value of each share is P 15. 1. How much is the compensation expense for the 3rd year in the vesting period if 5 of the executives left in the 3rd year of the vesting period? 2. How much is the compensation expense for the 3rd year in the vesting period if 2 of the executives left in the 3rd year of the vesting period?
- Date May 1, 2028 Account Titles and Explanation Debit CreditOn July 1, 2024, Bonita Company adopted a stock option plan that granted options to key executives to purchase 94,000 shares of the company's $1 par value common stock. The options were granted on January 1, 2025, and were exercisable 3 years after the date of grant if the grantee was still an employee of the company. The options expired 4 years from date of grant. The option price was set at $63, and the fair value option pricing model determines the total compensation expense to be $714,000. All of the options were exercised February 1, 2028, when the market price was $77 a share. Prepare journal entries relating to the stock option plan for the years 2024 through 2028. Assume that the employee performs services equally in 2025, 2026 and 2027. (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 O for the amounts. List all debit entries before credit entries.…On January 1, 2024, Sherwood Company granted 97,000 stock options to certain executives. The options are exercisable no sooner than December 31, 2026, and expire on January 1, 2030. Each option can be exercised to acquire one share of $1 par common stock for $8. An option-pricing model estimates the fair value of the options to be $3 on the date of grant. If unexpected turnover in 2025 caused the company to estimate that 15% of the options would be forfeited, what amount should Sherwood recognize as compensation expense for 2025?
- On July 1, 2024, Ayayai Company adopted a stock option plan that granted options to key executives to purchase 86,000 shares of the company's $1 par value common stock. The options were granted on January 1, 2025, and were exercisable 3 years after the date of grant if the grantee was still an employee of the company. The options expired 4 years from date of grant. The option price was set at $63, and the fair value option pricing model determines the total compensation expense to be $612,000. All of the options were exercised February 1, 2028, when the market price was $75 a share. Prepare journal entries relating to the stock bption plan for the years 2024 through 2028. Assume that the employee performs services equally in 2025, 2026 and 2027. (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 O for the amounts. List all debit entries before credit entries.…On January 1, 2024, Swifty Corporation granted 9,100 options to key executives. Each option allows the executive to purchase one share of Swifty's $5 par value common stock at a price of $21 per share. The options were exercisable within a 2-year period beginning January 1, 2026, if the grantee is still employed by the company at the time of the exercise. On the grant date, Swifty's stock was trading at $26 per share, and a fair value option-pricing model determines total compensation to be $402,000. On May 1, 2026, 7,280 options were exercised when the market price of Swifty's stock was $30 per share. The remaining options lapsed in 2028 because executives decided not to exercise their options. Prepare the necessary journal entries related to the stock option plan for the years 2024 through 2028. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for…On November 1, 2025, Columbo Company adopted a stock-option plan that granted options to key executives to purchase 30,000 shares of the company's $10 par value common stock. The options were granted on January 2, 2026, 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 $40, and the fair value option-pricing model determines the total compensation expense to be $450,000. All of the options were exercised during the year 2029: 20,000 on January 3 when the market price was $67, and 10,000 on May 1 when the market price was $77 a share. Prepare journal entries relating to the stock option plan for the years 2026, 2027, and 2028. Assume that the employee performs services equally in 2026 and 2027. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is…
- Pastore Incorporated granted options for 1 million shares of its $1 par common stock at the beginning of the current year. The exercise price is $31 per share, which was also the market value of the stock on the grant date. The fair value of the options was estimated at $9.00 per option. What would be the total compensation indicated by these options?On November 1, 2020, Ayayai Company adopted a stock-option plan that granted options to key executives to purchase 27,300 shares of the company’s $10 par value common stock. The options were granted on January 2, 2021, 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 $409,500.All of the options were exercised during the year 2023: 18,200 on January 3 when the market price was $68, and 9,100 on May 1 when the market price was $78 a share.Prepare journal entries relating to the stock option plan for the years 2021, 2022, and 2023. Assume that the employee performs services equally in 2022 and 2023.Olde Corporation provides an executive stock option plan. Under the plan, the company granted options on January 1, 2024, that permit executives to acquire 2.5 million of the company's $1 par value common shares within the next five years, but not before December 31, 2025 (the vesting date). The exercise price is the market price of the shares on the date of the grant, $13 per share. The fair value of the options, estimated by an appropriate option pricing model, is $2 per option. No forfeitures are anticipated Ignore taxes. Required: 1. Determine the total compensation cost pertaining to the options, assuming the fair value approach has been selected. 2. & 4. Prepare the appropriate journal entries (if any). Complete this question by entering your answers in the tabs below. Req 1 Reg 2 to 4 Determine the total compensation cost pertaining to the options, assuming the fair value approach has been selected. Note: Enter your answer in millions rounded to 2 decimal places (i.e., 5,500,000…
