On January 1, 2026, Vaughn Inc. granted stock options to officers and key employees for the purchase of 23,000 shares of the company's $10 par common stock at $24 per share. The options were exercisable within a 5-year period beginning January 1, 2028, by grantees still in the employ of the company, and expiring December 31, 2032. The service period for this award is 2 years. Assume that the fair value option-pricing model determines total compensation expense to be $337,000. On April 1, 2027,2,300 options were terminated when the employees resigned from the company. The market price of the common stock was $34 per share on this date. On March 31, 2028, 13,800 options were exercised when the market price of the common stock was $40 per share. Prepare journal entries to record issuance of the stock options, termination of the stock options, exercise of the stock options, and charges to compensation expense, for the years ended December 31, 2026, 2027, and 2028. (List all debit entries before credit entries.

On January 1, 2026, Vaughn Inc. granted stock options to officers and key employees for the purchase of 23,000 shares of the company's $10 par common stock at $24 per share. The options were exercisable within a 5-year period beginning January 1, 2028, by grantees still in the employ of the company, and expiring December 31, 2032. The service period for this award is 2 years. Assume that the fair value option-pricing model determines total compensation expense to be $337,000. On April 1, 2027,2,300 options were terminated when the employees resigned from the company. The market price of the common stock was $34 per share on this date. On March 31, 2028, 13,800 options were exercised when the market price of the common stock was $40 per share. Prepare journal entries to record issuance of the stock options, termination of the stock options, exercise of the stock options, and charges to compensation expense, for the years ended December 31, 2026, 2027, and 2028. (List all debit entries before credit entries.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter15: Contributed Capital

Section: Chapter Questions

Problem 8RE: On January 2, 2019, Brust Corporation grants its new CFO 2,000 restricted share units. Each of the...

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