On November 1, 2020, DaBaby Company adopted a stock-option plan that granted options to key executives to purchase 42,500 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 $210,000. All of the options were exercised during the year 2023: 20,100 on January 15 when the market price was $48, and 22,400 on June 1 when the market price was $56 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.
Q: Precision Tools 2021 Income Statement Net sales Less: Cost of goods sold Less: Depreciation Earnings...
A: Formula: Times interest earned ratio = Earnings before interest and taxes / Interest expense
Q: The following data were taken from the records of Winner Company for the month of October: Work in p...
A: Under FIFO method, it is assumed that only remaining portion of opening inventory is completed durin...
Q: For the month of January 2022, PBB Company reported the following production data for Finishing Depa...
A:
Q: The information below pertains to Pierpont Corp. for 202 Net income, $1,200,000. Common Stock, $10 p...
A: The formula for calculating basic EPS involves dividing net income by the number of common shares ou...
Q: Assume you wrote up a proposal requesting $5000 for charity. The money would be used to buy food tha...
A: A company/ corporation cannot work in vaccum, rather it has to work within the society and thus serv...
Q: Mr. Martínez is the owner of a company dedicated to the production of renewable energy. Nowadays, hi...
A: Martinez is in the production of renewable financing. The competition has increased and the resorts ...
Q: 2. Apple Company purchases 80 percent of Mango. At the date of acquisition, Mango has revenue of P25...
A: The question is related to Consolidation. The details are given as under Parent Share = 80% Non Con...
Q: ne of the current year, Department 2 (last department) received 80,0 nd of the month, it completed 8...
A: Equivalent Units:
Q: Examples of violation to notes on financial statements
A: Financial statements that describe a company's operations and financial performance. Financial state...
Q: Enumerate 7 violations on required disclosures in the Notes to Financial Statements.
A: Financial statement Notes These are those supporting notes which are included in the published finna...
Q: Using the data in the following table, how much bond amortization was recorded for the 4th interest ...
A: Lets understand the basics. When bond is issued at premium then premium needs to amortized either th...
Q: What is the gross margin ratio of Company B? How much purchases did Company A have for 2021? What is...
A: Gross Margin Ratio = Gross Profit / Sales Purchases = Cost of Goods Sold x 60% (Given) Accounts Rece...
Q: A.B. Mahusay decided to put up an aircon cleaning & repair services on January 1, 2020. In order to ...
A: Accounting equation is the record prepared to analyze the effect of transactions on the basic accoun...
Q: Inc. adds materials at the beginning of the process in department USB. Conversion costs were 70% co...
A: Solution: Equivalent units of production (EUP) Units % material EUP-Materials % Conversion E...
Q: 1/2/21 Issued 15,000 shares of $20 par common stock at $30, receiving cash. 1/2/21 Issued 4,000 shar...
A: A journal entry is a form of accounting entry that is used to report a business transaction in a com...
Q: compute for throughput time
A: Throughput time or the period is the time in days or in hours which are required by the company in o...
Q: . How do the relationships between the balance sheet, income statement, job cost ledger, and equipm...
A: A balance sheet is a financial statement which shows a company's assets, liabilities, and shareholde...
Q: Account Name Debit Credit Sales 750,000 Sales Returns and Allowances 15,000 Sales Discounts 10,000 P...
A: Formula: Cost of goods sold = Beginning Inventory + Net purchases - Ending Inventory
Q: before write-off. (Write-off of the year was P20,000) No.2: P5,000 from accounts written off in a y...
A: Bad debt recovery refers to the sum value of money received for a bad debt that was earlier written ...
Q: QUESTION 4 Indicate whether each of the following costs incurred by a manufacturer would be consider...
A: The costs incurred in the production of a product are referred to as its product cost. These costs i...
Q: E21.8 (LO3) (Lessor Entries, Sales-Type Lease) Crosley Company, a machinery dealer, leased a machine...
A: Present Value of lease: PV(rate, nper, pmt, [fv]), [type]) = -PV (6%,8,35004, , 1) = 230,410
Q: 1. Mr. A is the owner of a grocery store. He was informed by the Fortune Cigarette supplier today th...
A: Increase in Price per pack = 1,000 - 900 = 100 Total Impact on weekly order = 100 * 300 = 30,000 Thu...
Q: The following information is from XYZ Triple Stores. The company runs three stores and the December ...
A: store x store y Retail revenue $17,976 $26250 $37,380 events revenue 11,760 4,620 2,520 tota...
Q: 1. _____ are controls that do not rely on the client's information technology (IT) environment for t...
A: Solution Note : Dear student as per the Q&A guideline we are required to answer the first questi...
Q: Which of the following is not a characteristic of a financial asset held for trading? a. It is acqui...
A: Trading in financial instrument include assets such as stocks bonds mutual fund. the financial asset...
Q: Abednego Company purchased equity investments held for trading on January 1, 2020. Market – (12/31/2...
A: In case of equity investments held for trading , they should be reported at market value as at year ...
Q: itor considers the choice of the plan to be extremely important. Consequently, the auditor has asked...
A: In the above question, it is given that : Employers must provide medical insurance at "fair, non-pr...
Q: What is the value of customer relations and customer service?
A: Customer relations is the relationship with customer and the focus of which is to build customer rel...
Q: At the beginning of 2009, a company purchased a fire insurance policy covering a property for a peri...
A: The prepaid expenses are the expenses paid but not due for payment.
Q: PROBLEM 1 (Income Statement). Presented here are the components in Sanders Company's income statemen...
A: The income statement is prepared to record revenue and expenses for the current period and find the ...
Q: On January 2, 2013, Phillips Corporation purchase 80% of signage Company's outstanding shares for P6...
A: Introduction IFRS 3 provides two options of measuring non-controlling interest in an acquiree: ...
Q: Dew Drop Inn, Inc., has direct labor costs of $13 per hour, direct materials are $1 per room and ove...
A: The total cost consists of all the outlay made by a firm for making its business activities continuo...
Q: P21.7 (LQ.3) (Lessor Computations and Entries, Sales-Type Lease with Guaranteed Residual Value) Amir...
A: Note: Only a, c, and d are answered as required a. Amount of initial lease liability = ($60,000 x...
Q: On July 1,2020, the Prince of Wales, Inc. signs a 10-year non-cancellable lease agreement for a stor...
A: Lease Liability It is important for the business entity to raise the fund to investment in the capit...
Q: Management is considering a one-time-only special order. There is sufficient idle capacity to fill t...
A: Introduction:- Management (or management) is the administration of a company, whether for-profit, no...
Q: Jokalet Inc. is running on a P2 million equity and needs Php500,000 additional funds to expand the b...
A: Ratio analysis means where different ratio of various years of years companies has been compared and...
Q: need answers thank you.
A: The question is based on the concept of Financial Accounting.
Q: 4... Cullumber Corporation had the following 2020 income statement. Sales revenue $213,000 Cos...
A: Cash received from customers = Sales - Increase in accounts receivables Cash paid to suppliers = Cos...
Q: Compute the Revenue Effect- Growth Component, indicate if favorable/(unfavorable). *The activity dri...
A: Revenue refers to the amount received by the company from selling goods and services to the customer...
Q: assume you are employed as the chief financial officer of a corporation and are responsible for prep...
A: Introduction:- Financial statements are official records of a company's, person's, or other entity's...
Q: DIRECT COST PER SUPERVISORPER MONTH Sum of GROSS PAY Column Labels Direct Direct Total Rov Labels Ce...
A: While computing the costs involved in the production of goods, direct and indirect costs are classif...
Q: The following information pertains to ABC: March 1 Beginning inventory = 30 units @ $5 March 3 Pur...
A: Under LIFO Method, cost of goods sold is calculated on the Assumption that units of inventory which ...
Q: Mandarin Manufacturing Company uses a process cost system with FIFO method of costing to account for...
A: Forming Deptt Process A/c Particular Units Amounts Particular Units Amounts Op...
Q: at the inception of the process. Conversion costs are incurred evenly throughout the process. The ma...
A: in process costing the product are produced as a result of two or more process so the product passes...
Q: If FIFO Method is used, the costs of goods manufactured amounted to:
A: Equivalent units means where the some goods remain incomplete at the end of process and we need to c...
Q: Team, please create an amortization schedule which shows different dollar amounts you borrow at diff...
A: The correct answer for the above mentioned answer is given in the following steps for your reference...
Q: Anchor, inc, reports pretax financial income of $100,000 for 2020, S120,000 for 2021, and for 2022. ...
A: Determination of taxable income 2020 2021 2022 Pretax Financial income $100,000 $120,000 $14...
Q: 9. Create an Evaluation Summary indicating the NPV, IRR, PI, and Payback period of all options. Plea...
A: Solution Calculation of NPV year cash flow A cash flow B pv factor @ 8% present value of...
Q: The following transactions were taken from the records of Marimar Company for you to prepare a stat...
A: Statement of equity shows the position of the funds which represents the balance of the shareholders...
Q: Please explain how to arrive at the "Market Price of Bonds (% of face) = 94.285%" section in the exc...
A: The price for bond implies to the consideration amount paid by investor for purchasing bond. In prov...
Step by step
Solved in 2 steps
- Page of 5 ZOOM Practice Exercises - Stock Options On November 1, 2020, Pronghorn Company adopted a stock-option plan that granted options to key executives to purchase 38,100 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 $40, and the fair value option-pricing model determines the total compensation expense to be $571,500. 4. All of the options were exercised during the year 2023: 25,400 on January 3 when the market price was $67, and 12,700 on May 1 when the market price was $76 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. General Journal Debit Credit ENG ASA qb INTL *- Prisc F4 F5 F6 F7 F8 F9 F10 F11 F12 Ins 23Settings On May 1, 2021, Roger Rabbit Company adopted a stock-option plan that granted options to key executives to purchase 8,000 shares of the company's $10 par value common stock. The options were granted on January 1, 2022 and were exercisable 2 years after the date of grant if the grantee was still an employee of the company. The options expired 5 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 $189,000. All of the options were exercised during the year 2024: 3,400 on January 3 when the market price was $38, and 4,600 on May 1 when the market price was $42 a share. Prepare journal entry relating to the stock option plan for the year 2023. Assume that the employee performs services equally in 2022 and 2023. O Debit Compensation Expense $94,500; Credit Paid-in Capital-Stock Options $94,500 O Debit Compensation Expense $189,000; Credit Paid-in Capital-Stock Options $189,000 O Debit…Recording Stock Options: Issuance and Exercise In October 2019, Meno Corp. announced a stock option incentive plan for its top executives. The plan provides each executive 9,000 stock options for Meno’s common stock, $1 par, at an exercise price of $36 per share reduced by the percentage increase in EPS from December 31, 2019, to December 31, 2021. The rights are nontransferable and are exercisable three years after the grant date and prior to five years from the grant date. Continuing employment is required through exercise date, and the requisite service period ends on the first possible exercise date.On January 1, 2020, Martha Smith was granted 3,000 options when the market price was $30 per share. Using an option-pricing model, the fair value of the options granted to Smith was valued at $9 per option. On December 31, 2020, Meno’s management believed that Smith would exercise her options at the first exercise date. By December 31, 2021, Meno’s EPS had increased by 20%. Smith…
- Recording Stock Options: Issuance and Exercise In October 2019, Meno Corp. announced a stock option incentive plan for its top executives. The plan provides each executive 6,000 stock options for Meno's common stock, $1 par, at an exercise price of $36 per share reduced by the percentage increase in EPS from December 31, 2019, to December 31, 2021. The rights are nontransferable and are exercisable three years after the grant date and prior to five years from the grant date. Continuing employment is required through exercise date, and the requisite service period ends on the first possible exercise date. On January 1, 2020, Martha Smith was granted 3,000 options when the market price was $30 per share. Using an option-pricing model, the fair value of the options granted to Smith was valued at $9 per option. On December 31, 2020, Meno's management believed that Smith would exercise her options at the first exercise date. By December 31, 2021, Meno's EPS had increased by 20%. Smith…Title Under its executive stock option plan, National Corporation granted 30 million options on January 1, Description Under its executive stock option plan, National Corporation granted 30 million options on January 1, 2021, that permit executives to purchase 30 million of the company’s $1 par common shares within the next six years, but not before December 31, 2023 (the vesting date). The exercise price is the market price of the shares on the date of grant, $30 per share. The fair value of the options, estimated by an appropriate option pricing model, is $2 per option. Suppose that unexpected turnover during 2022 caused the forfeiture of 5% of the stock options. Compute the amount of compensation expense for 2022 and 2023.</o:p> </o:p>On March 1, 2025, Ferguson Corp. purchased a put option on shares of SST stock. The contract was for 100 shares at a strike price of $120 per share, with an expiration date of May 31, 2025. Ferguson settled the option on May 5 (assume cash settlement). Additional information pertaining to the option is provided below. March 1 March 31 May 5 Price of SST stock: $120 $110 $115 Time value of option: $30 $20 $10 Required: 1. Compute the cost of the option paid by Ferguson Corp. on March 1, 2025. 2. Compute the balance of the option account on date of settlement.
- (Issuance and Exercise of Stock Options) On November 1, 2017, 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, 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 $40, and the fair value option-pricing modeldetermines the total compensation expense to be $450,000.All of the options were exercised during the year 2020: 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.InstructionsPrepare 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.Subject: accounting On January 1, 2019, QRS Company granted 80,000 stock options to certain executives. The option vesting period is 4 years ending on December 31, 2022. Each option can be exercised to acquire one share of $1 par common stock for $5. The fair value of each option was estimated to be $3 on the grant date. What amount should QRS recognize as compensation expense for 2020?LCI Cable Company grants 1 million performance stock options to key executives at January 1, 2018. Theoptions entitle executives to receive 1 million of LCI $1 par common shares, subject to the achievement ofspecific financial goals over the next four years. Attainment of these goals is considered probable initially andthroughout the service period. The options have a current fair value of $12 per option.Required:1. Prepare the appropriate entry when the options are awarded on January 1, 2018.2. Prepare the appropriate entries on December 31 of each year 2018–2021.3. Suppose at the beginning of 2020, LCI decided it is not probable that the performance objectives will be met.Prepare the appropriate entries on December 31 of 2020 and 2021.
- Accounting for Stock Options On April 1 of Year 1, Badger Corp. announced a stock option incentive plan for its top executives. The plan provides certain executives stock options for the company's common stock. Each option allows for the purchase of one share of common stock, par $1, at a standard option price of $25 per share. The rights are nontransferable and are exercisable three years after the grant date and prior to five years from the grant date. Continuing employment is required through the exercise date, and the requisite service period ends on the first possible exercise date. On April 1 of Year 1, 4,000 options were granted to employees when the market price was $30 per share. Using an option-pricing model, the fair value of the options granted was $36,000. Employees exercised 2,400 options on June 30 of Year 4, when the market price of the stock was $45 per share. . a. Compute the total amount of compensation cost for the grant made on April 1 of Year 1. $ 36,000 ✔ b.…Problem 1 (Adapted)On January 1, 2017, Gliezel company issued options to key employees to purchase 20,000 ordinary shares of P100 par value at P125 per share. On such date, the market value of ordinary share is P150 per share. The fair value of each share option is P30. These options are exercisable starting January 1, 2019 and expire one year after. Options covering 17,500 shares are exercised on January 15, 2019 and the remaining options expired. a. Compute compensation expense for the year 2017, 2018 and 2019.b. Prepare journal entries to record the compensation each year as well as the exercise and expiration of the share optionsA-12: Put option On March 1, 2022, Ferguson Corp. purchased a put option on shares of SST stock. The contract was for 100 shares at a strike price of $90 per share, with an expiration date of May 31, 2022. Ferguson settled the option on May 5 (assume cash settlement). Additional information pertaining to the option is provided below. March 1 March 31 May 5 Price of SST stock: $90 $80 $85 Time value of option: $50 $40 $30 Required:1. What is cost of the option paid by Ferguson Corp. on March 1, 2022?2. Compute the balance of the option account on May 5 before the settlement.