Share-Based Compensation (in part) Share-based compensation cost for RSUS is measured based on the closing fair market value of the Company's common stock on the date of grant... The Company reports paid-in capital and recognizes share-based compensation cost over the award's requisite service period on a straight-line basis. Which of the following is an accurate statement regarding the company's policy? Multiple Choice The policy is appropriate as long as Peach periodically adjusts the compensation based on the change in the stock's fair value until the award vests. The policy is appropriate because the recipients have only the option to receive cash; cash settlement is not specified.

Share-Based Compensation (in part) Share-based compensation cost for RSUS is measured based on the closing fair market value of the Company's common stock on the date of grant... The Company reports paid-in capital and recognizes share-based compensation cost over the award's requisite service period on a straight-line basis. Which of the following is an accurate statement regarding the company's policy? Multiple Choice The policy is appropriate as long as Peach periodically adjusts the compensation based on the change in the stock's fair value until the award vests. The policy is appropriate because the recipients have only the option to receive cash; cash settlement is not specified.

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter13: Corporations: Earning & Profits And Distributions

Section: Chapter Questions

Problem 29P

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Rotate Company adopted the following share-based compensation plans for its senior executives. Each senior executive has a unique plan basing on his/her functions in the company. The par value of Rotate’s ordinary share is P20. The following share-based grants were declared by the entity. On January 1, 2021, it granted 1,000 share options each to 200 of its employees. The exercise price of the option is P25. The vesting of said shares is conditional upon the employees staying for three years, after which they have two years to exercise such before the options expire. During 2021, 5 employees resigned and an additional 15 employees are expected to leave on the next two years. During 2022, actual resignations totalled 8 and another 10 is expected to resign next year. No employees left during 2023. Sixty percent of the share options were exercised at yearend 2024 and the balance at yearend 2025. On January 1, 2022, it granted 100 of its employees 1,000 share appreciation rights…
Rotate Company adopted the following share-based compensation plans for its senior executives. Each senior executive has a unique plan basing on his/her functions in the company. The par value of Rotate’s ordinary share is P20. The following share-based grants were declared by the entity. On January 1, 2021, it granted 1,000 share options each to 200 of its employees. The exercise price of the option is P25. The vesting of said shares is conditional upon the employees staying for three years, after which they have two years to exercise such before the options expire. During 2021, 5 employees resigned and an additional 15 employees are expected to leave on the next two years. During 2022, actual resignations totalled 8 and another 10 is expected to resign next year. No employees left during 2023. Sixty percent of the share options were exercised at yearend 2024 and the balance at yearend 2025. On January 1, 2022, it granted 100 of its employees 1,000 share appreciation rights…
Rotate Company adopted the following share-based compensation plans for its senior executives. Each senior executive has a unique plan basing on his/her functions in the company. The par value of Rotate’s ordinary share is P20. The following share-based grants were declared by the entity. On January 1, 2021, it granted 1,000 share options each to 200 of its employees. The exercise price of the option is P25. The vesting of said shares is conditional upon the employees staying for three years, after which they have two years to exercise such before the options expire. During 2021, 5 employees resigned and an additional 15 employees are expected to leave on the next two years. During 2022, actual resignations totalled 8 and another 10 is expected to resign next year. No employees left during 2023. Sixty percent of the share options were exercised at yearend 2024 and the balance at yearend 2025. How much is the ending balance of the Share Options Outstanding that will show in the 2021…
Rotate Company adopted the following share-based compensation plans for its senior executives. Each senior executive has a unique plan basing on his/her functions in the company. The par value of Rotate’s ordinary share is P20. The following share-based grants were declared by the entity. On January 1, 2021, it granted 1,000 share options each to 200 of its employees. The exercise price of the option is P25. The vesting of said shares is conditional upon the employees staying for three years, after which they have two years to exercise such before the options expire. During 2021, 5 employees resigned and an additional 15 employees are expected to leave on the next two years. During 2022, actual resignations totalled 8 and another 10 is expected to resign next year. No employees left during 2023. Sixty percent of the share options were exercised at yearend 2024 and the balance at yearend 2025. On January 1, 2022, it granted 100 of its employees 1,000 share appreciation rights…
Rotate Company adopted the following share-based compensation plans for its senior executives. Each senior executive has a unique plan basing on his/her functions in the company. The par value of Rotate’s ordinary share is P20. The following share-based grants were declared by the entity. On January 1, 2021, it granted 1,000 share options each to 200 of its employees. The exercise price of the option is P25. The vesting of said shares is conditional upon the employees staying for three years, after which they have two years to exercise such before the options expire. During 2021, 5 employees resigned and an additional 15 employees are expected to leave on the next two years. During 2022, actual resignations totalled 8 and another 10 is expected to resign next year. No employees left during 2023. Sixty percent of the share options were exercised at yearend 2024 and the balance at yearend 2025. How much is the ending balance of the Accrued Salaries Payable that will show in the 2021…
How much is the ending balance of the Share Options Outstanding that will show in the 2024 Statement of Financial Position? Rotate Company adopted the following share-based compensation plans for its senior executives. Each senior executive has a unique plan basing on his/her functions in the company. The par value of Rotate’s ordinary share is P20. The following share-based grants were declared by the entity. On January 1, 2021, it granted 1,000 share options each to 200 of its employees. The exercise price of the option is P25. The vesting of said shares is conditional upon the employees staying for three years, after which they have two years to exercise such before the options expire. During 2021, 5 employees resigned and an additional 15 employees are expected to leave on the next two years. During 2022, actual resignations totalled 8 and another 10 is expected to resign next year. No employees left during 2023. Sixty percent of the share options were exercised at yearend 2024…
Hammerstein Corporation offers a variety of share-based compensation plans to employees. Under its restricted stock award plan, the company, on January 1, 2021, granted 2 million of its $1 par common shares to various division managers. The shares are subject to forfeiture if employment is terminated within four years. The common shares have a market price of $19.7 per share on the award date. Required: 1. Determine the total compensation cost from these restricted shares. 2. & 3. Prepare the appropriate journal entries. 4. Suppose a 10% forfeiture rate was expected prior to vesting. Determine the total compensation cost, assuming the company follows the fair value approach and chooses to anticipate forfeitures at the grant date. Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Req 4 Determine the total compensation cost from these restricted shares. (Enter your answer in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as…
Second Link Services granted restricted stock units (RSUs) representing 16 million of its $1 par common shares to executives, subject to forfeiture if employment is terminated within four years. After the recipients of the RSUs satisfy the vesting requirement, the company will distribute the shares. The common shares had a market price of $10 per share on the grant date. Ignoring taxes, what is the total compensation cost pertaining to the restricted stock units? What is the effect on earnings in the year after the shares are granted to executives?
American Optical Corporation provides a variety of share-based compensation plans to its employees. Under itsexecutive stock option plan, the company granted options on January 1, 2018, that permit executives to acquire4 million of the company’s $1 par common shares within the next five years, but not before December 31, 2019(the vesting date). The exercise price is the market price of the shares on the date of grant, $14 per share. The fairvalue of the 4 million options, estimated by an appropriate option pricing model, is $3 per option. No forfeituresare anticipated. Ignore taxes.Required:1. Determine the total compensation cost pertaining to the options.2. Prepare the appropriate journal entry to record the award of options on January 1, 2018
Heidi Software Corporation provides a variety of share-based compensation plans to its employees. Under its executive stock option plan, the company granted options on January 1, 2024, that permit executives to acquire 18 million of the company's $1 par 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 grant, $31.00 per share. The fair value of the 18 million options, estimated by an appropriate option pricing model, is $7 per option. • No forfeitures are anticipated. • Ignore taxes. Required: 1. Determine the total compensation cost pertaining to the options. 2. Prepare the appropriate journal entry to record the award of options on January 1, 2024. 3. Prepare the appropriate journal entry to record compensation expense on December 31, 2024. 4. Prepare the appropriate journal entry to record compensation expense on December 31, 2025. Complete this question by entering…
Magnetic-Optical Corporation offers a variety of share-based compensation plans to employees. Under itsrestricted stock unit plan, the company on January 1, 2018, granted restricted stock units (RSUs) representing4 million of its $1 par common shares to various division managers. The shares are subject to forfeiture if employment is terminated within three years. The common shares have a market price of $22.50 per share on the grantdate. Management’s policy is to estimate forfeitures.Required:1. Determine the total compensation cost pertaining to the RSUs.2. Prepare the appropriate journal entry to record the RSUs on January 1, 2018.3. Prepare the appropriate journal entry to record compensation expense on December 31, 2018.4. Suppose Magnetic-Optical expected a 10% forfeiture rate on the RSUs prior to vesting. Determine the totalcompensation cost.
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