Question
In: Accounting
Rutter Inc. granted (see below for #) stock options to executives and employees on January 1,...
- Rutter Inc. granted (see below for #) stock options to executives and employees on January 1, 2017. The options have a strike price is $10 per share and expire in 2019. The par value of the common stock is $ Using an option pricing model, the company calculates a fair value of $20 per share. The expected service period, or benefit period, is (see below) years.
- Prepare the journal entries for 2017 and 2018.
- In 2019, (see below) % of the options are exercised and the remaining options expire.
Last Name # of options granted_ service period % exercised_______
A – D 200,000 2 years 20%
E – K 300,000 3 years 30%
L – S 250,000 2 years 40%
T – Z 500,000 3 years 50%
Solutions
ekkarill92 answered 11 months agoRelated Solutions
Rutter Inc. granted 300,000 stock options to executives and employees on January 1, 2017. The options...
Rutter Inc. granted 300,000 stock options to executives and
employees on January 1, 2017. The options have a strike price is
$10 per share and expire in 2019. The par value of the common stock
is $1. Using an option pricing model, the company calculates a fair
value of $20 per share. The expected service period, or benefit
period, is 3 years.
a. Prepare the journal entries for 2017 and 2018.
b. In 2019, 30% of the options are exercised...
On January 1, 2018, Cullumber Inc. granted stock options to officers and key employees for the...
On January 1, 2018, Cullumber Inc. granted stock options to
officers and key employees for the purchase of 20,000 shares of the
company’s $10 par common stock at $27 per share. The options were
exercisable within a 5-year period beginning January 1, 2020, by
grantees still in the employ of the company, and expiring December
31, 2024. The service period for this award is 2 years. Assume that
the fair value option-pricing model determines total compensation
expense to be $323,200....
On January 1, 2018 Martinez Inc. granted stock options to officers and key employees for the...
On
January 1, 2018 Martinez Inc. granted stock options to officers and
key employees for the purchase of 19000 shares of the company's $10
par common stock at $25 per share. The options were exercisable
within a 5 year period beginning January 1, 2020 by grantees still
in the employ of the company, and expiring December 31, 2024. The
service period for this awards is 2 years. Assume that the fair
value option pricing model determines total compensation expense to...
On January 1, 2018, M Company granted 95,000 stock options to certain executives. The options are...
On January 1, 2018, M Company granted 95,000 stock options to
certain executives. The options are exercisable no sooner than
December 31, 2020, and expire on January 1, 2024. Each option can
be exercised to acquire one share of $1 par common stock for $10.
An option-pricing model estimates the fair value of the options to
be $4 on the date of grant.
If unexpected turnover in 2019 caused the company to estimate that
15% of the options would be...
On January 1, 2016, Webber Company granted 56,300 stock options to certain executives. The options are...
On January 1, 2016, Webber Company granted 56,300 stock options
to certain executives. The options are exercisable no sooner than
December 31, 2018, and expire on January 1, 2022. 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 2017 caused the company to estimate that
10% of the options would be...
On January 2, 2015, Ryan Company adopted a stock-option plan that granted options to key executives...
On January 2, 2015, Ryan Company adopted a stock-option plan
that granted options to key executives to purchase 20,000 shares of
the company's $5 par value common stock. The options were granted
on January 2, 2015, and were exerciseable two years after the date
of grant if the grantee was still an employee of the company. The
option exercise price was set at $30, and the fair value
option-pricing model determines the total compensation expense to
be $400,000. What is...
Under its executive stock option plan, Worcester Corporation granted options on January 1,2018, that permit executives...
Under its executive stock option plan, Worcester Corporation
granted options on January 1,2018, that permit executives to
purchase 20 million of the company's $1 par common shares within
the next eight years, but before December 31,2020 ( the vesting
date). the exercise price is the market price of the shares on the
date of grant, $18 per share. The fair value of the options,
estimated by an appropriate option pricing model, is $5 per option.
No forfeitures are anticipated. The...
On January 1, 2019, Smith Inc. granted 6,500 Stock Appreciation Rights (SAR) to its executives, exercisable...
On January 1, 2019, Smith Inc. granted 6,500 Stock Appreciation
Rights (SAR) to its executives, exercisable 2 years after grant
date (unless employment is terminated) and prior to 8 years from
grant date. The executives are to receive cash at exercise date for
the excess of the market price over the pre-established base price
of $25. The year-end fair values of each SAR were $3, 5.50, and
$4.80 in 2019, 2020 and 2021 respectively. The executives exercise
their SARs on...
On January 1, 2019, Smith Inc. granted 6,500 Stock Appreciation Rights (SAR) to its executives, exercisable...
On January 1, 2019, Smith Inc. granted 6,500 Stock Appreciation
Rights (SAR) to its executives, exercisable 2 years after grant
date (unless employment is terminated) and prior to 8 years from
grant date. The executives are to receive cash at exercise date for
the excess of the market price over the pre-established base price
of $25. The year-end fair values of each SAR were $3, 5.50, and
$4.80 in 2019, 2020 and 2021 respectively. The executives exercise
their SARs on...
On January 1, 2019, Golow Inc., granted 300,000 stock options to several of its officers for...
On January 1, 2019, Golow Inc., granted 300,000 stock options to
several of its officers for the purchase of the Company’s $10 par
value common stock at an option price of $30 PER SHARE. The options
were exercisable beginning January 1, 2021 by grantees still
working for the Company on that date. (There is a two year service
period.) Any unexercised options will terminate on December 31,
2029. Assume that the fair value option pricing model determines
total compensation expense...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- An investor is considering purchasing a Treasury bond with a 20 year maturity, an 8% coupon...
- Write a program that copies the contents of one file to a destination file. This program...
- how to conduct a marketing mix for 3d crest white strips
- Is big data analytics used for service innovation at Amazon? If so, please write a brief...
- A shrink-fit process has been used to enhance the pressure carrying capacity of a cylinder. During...
- Ten-year zero coupon bonds issued by the U.S. Treasury have a face value of $1,000 and...
- The Blossom Department of Transportation has issued 25-year bonds that make semiannual coupon payments at a...
ADVERTISEMENT