Question

In: Finance

Which is true about restricted stock: a. These grants are immediately vested. b. These grants are...

  1. Which is true about restricted stock:

a.

These grants are immediately vested.

b.

These grants are generally in the form of convertible preferred stock.

c.

It is not dilutive.

d.

Any dividends paid will be received by the employee.

Solutions

Expert Solution

  • Restricted stock is a form of executive compensation offered by corporations.
  • They are most common in established companies that want to motivate employees by giving them an equity stake.
  • Restricted stock represents actual ownership of shares but come with conditions on the timing of their sale.
  • The restrictions are intended to deter premature selling that might adversely affect the company, as well as to motivate managers to align their interests with the future of the company.
  • Restricted Stock Units (RSUs) are not eligible for dividend payments until the point in time when they have been converted to stock and distributed to employees. This usually coincides with a vesting event and can occur much later than the timing of when a RSAs is issued/eligible for dividends

There fore answer b is correct  

These grants are generally in the form of convertible preferred stock.

jeff jeffy answered 2 years ago
Next > < Previous

Related Solutions

Which is true about restricted stock: a. These grants are immediately vested. b. These grants are...
Which is true about restricted stock: a. These grants are immediately vested. b. These grants are generally in the form of convertible preferred stock. c. It is not dilutive. d. Any dividends paid will be received by the employee.
​Which of the following statements concerning restricted stock is correct? (A) An executive purchases restricted stock...
​Which of the following statements concerning restricted stock is correct? (A) An executive purchases restricted stock at a price that is equal to the market value on the date of the grant. (B) An executive can elect to be taxed at the time of the grant of the restricted stock but cannot recoup tax payments if the stock is later forfeited. (C) Dividends on the stock are only paid to the executives after any restrictions are removed from the ownership....
What is restricted stock? How do restricted stock awards differ from restricted stock units (RSUs)? Describe...
What is restricted stock? How do restricted stock awards differ from restricted stock units (RSUs)? Describe how compensation expense is determined and recorded for a restricted stock award plan?
Which of the following is not a true statement about a 403(b)?
Which of the following is not a true statement about a 403(b)?A 403(b) can only be established by a non-profit organization, like a hospital or a school.A 403(b) only involves the employer making contributions.A 403(b) could be enabled for plan loans.A 403(b) is not available to independent contractors who work for the non-profit organization.Which of the following statements correctly describes a SEP plan?The plan can exclude employees who are aged 25 or younger.The allocation formula cannot be integrated with Social...
1) Which ONE of the following is NOT TRUE about p16: a)it is an oncogene b)it...
1) Which ONE of the following is NOT TRUE about p16: a)it is an oncogene b)it is on the same pathway and hence seldom mutated in tumors when RB is c)it is often mutated in cancers such as familial melanoma d)it is encoded in the same gene locus as p19-ARF e)It is a cyclin dependent kinase inhibitor (CKI) 2)Which ONE of the following is NOT a property of the transformed phenotype: a)Induced by over expression of tumor suppressor genes b)Anchorage...
Which of the following is true about fringe benefits? Which of the following is true about...
Which of the following is true about fringe benefits? Which of the following is true about fringe benefits? They represent additional compensation given for services performed They are only available for employees. The amount of the fringe benefit is never subject to income tax. They represent additional cash paid directly to employees.
Which of the following is not true about Preferred Stock? Multiple Choice It typically pays a...
Which of the following is not true about Preferred Stock? Multiple Choice It typically pays a dividend that never changes. Preferred stock holders are ahead of bondholders in line to receive assets following a liquidation. Any missed dividends must be paid in full before a company can make dividend payments to holders of common stock. Its valuation can be determined by using the formula to value perpetuities. Not every company issues preferred stock. Which of the following is NOT true...
Computing EPS: Restricted Stock Awards West Inc. granted 5,000 shares of restricted common stock shares at...
Computing EPS: Restricted Stock Awards West Inc. granted 5,000 shares of restricted common stock shares at the beginning of 2020 to company managers that will vest after 4 years of service. Net income for the year is $360,000, and 250,000 common shares were outstanding the entire year. The fair value of the shares on January 1, 2020, is $25 per share. The average market price of common shares in 2020 is $25 per share. a. Compute basic earnings per share....
Which of the following statements about "meaning" is true? A) Group of answer choices B) Point...
Which of the following statements about "meaning" is true? A) Group of answer choices B) Point of view is synonymous with meaning. C) Setting and action are unrelated to meaning in a story ENglish 1302 D) The subject of a story states its meaning E) Meaning is made up of separate themes
Which of these is true about secondary contact? A. Hybrids are always infertile. B. Hybridization can...
Which of these is true about secondary contact? A. Hybrids are always infertile. B. Hybridization can result in new species. C. Hybrids typically resemble neither parent species. D. Reinforcement can decrease differences between parent species.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT