1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
iren2701 [21]
3 years ago
6

On January 1, 2018, M Company granted 90,000 stock options to certain executives. The options are exercisable no sooner than Dec

ember 31, 2020, and expire on January 1, 2024. Each option can be exercised to acquire one share of $1 par common stock for $12. An option-pricing model estimates the fair value of the options to be $5 on the date of grant. What amount should M recognize as compensation expense for 2018?
Business
1 answer:
Doss [256]3 years ago
4 0

Answer: $120,000

Explanation:

Given that,

Company granted = 90,000 stock options

common stock = $12

one share = $1 par common stock = $12

Fair value of the option = $5

Total Value of the option = $90,000 × $5 = $450,000

$450,000 × 90% = $405,000

450,000\times\frac{2}{3}   (2 out of 3 years)

        = $270,000

\frac{450,000}{3}

= $150,000

Therefore,

compensation expense for 2018 =  $270,000 - $150,000

                                                       = $120,000

You might be interested in
You plan on supplementing your income. you would like to withdraw a semiannual salary of $6,951.20 from an account paying 1.75%
ValentinkaMS [17]
We are given with the data: A = <span>$6,951.20 per semi-annum that is $13902.4 per annum, i equal to 1.75% compounded semi-annually, and asked for P or the present worth to maintain the withdrawal for 15 years. 
the formula to be used is attached in the file (third one). substitute the i = 0.0175, n = 30, A = </span>$13902.4 and get P. 

5 0
3 years ago
Why you believe it is important to align it with the organization's core goals and strategic direction?
OverLord2011 [107]

Answer:

Managers must ensure that their individual goals and work - as well as that of their direct reports - is in line with the overarching strategy. Then, you can ensure that your people are driving progress daily. Proper strategic alignment ensures the work of your best talent is being effectively and efficiently utilized

4 0
4 years ago
Alison Skateland, a real estate broker in Yuba City, California, has recently become interested in the sale of business opportun
Dafna1 [17]

Answer: the correct answer is A) If real property is involved in the sale, the broker (Alison, in this case) usually treats the sale of the business and sale of the land/building as two separate and concurrent transactions with two concurrent and contingent escrows.

Explanation:

The sale of business opportunities may involve the sale of only personal property.

Alison, in dealing with the sale of business opportunities, must remember to inform the purchaser of the various governmental agencies that the purchaser should contact for required permits, licenses, and clearances. These agencies include the IRS, State Board of Equalization, State Department of Benefit Payments, State Department of Industrial Relations, and various other county and municipal agencies.

The sale of a business opportunity includes the business's stock, trade fixtures, and trade name, a competition agreement, and lease assignment. While such a sale also includes the goodwill of a business, a monetary value cannot be placed on the goodwill.

7 0
3 years ago
What role do pawnshops playy in American economy
RUDIKE [14]
Getting rid of old stuff to people who want it instead of throwing it away.
4 0
3 years ago
China's steel industry:___________
Ronch [10]

Answer:

B

Explanation:

If I'm not wrong, their steel industry is still growing due to the inputs of iron ore and coal.

4 0
3 years ago
Read 2 more answers
Other questions:
  • Nicholas Manufacturing just announced yesterday that its fourth quarter earnings will be 10% higher than last year's fourth quar
    13·1 answer
  • a company had no office supplies available at the beginning of the year. during the year, the company purchased $370 worth of of
    8·1 answer
  • 5 Examples of fiscal policy
    8·1 answer
  • Larry Mitchell invested part of his $ 35 comma 000$35,000 advance at 4 %4% annual simple interest and the rest at 9 %9% annual s
    13·1 answer
  • The Window Store will have a value of $139,000 if the economy does well this coming year and a value of $121,000 if the economy
    8·1 answer
  • Which of the following statements about adjusting entries is NOT true?
    15·1 answer
  • Which of the following types of production would most likely use job-order costing? A. Construction of custom homes B. Farming C
    5·1 answer
  • Everything else held constant, if the federal government were to guarantee today that it will pay creditors if a corporation goe
    12·1 answer
  • Kristi is considering an investment that will pay $5,000 a year for 7 years, starting one year from today. How much should she p
    13·1 answer
  • in an international setting, day-to-day decisions about labor relations are usually handled by each foreign subsidiary
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!