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Yanka [14]
3 years ago
13

On June 1, year 2, Oak Corp. granted stock options to certain key employees as additional compensation. The options were for 1,0

00 shares of Oak's $2 par value common stock at an option price of $15 per share. Market price of this stock on June 1, year 2, was $20 per share. The options were exercisable beginning January 2, year 3, and expire on December 31, year 4. On April 1, year 3, when Oak's stock was trading at $21 per share, all the options were exercised. Oak uses the intrinsic method of accounting for stock option plans. What amount of pretax compensation should Oak report in year 2 in connection with the options
Business
1 answer:
Dimas [21]3 years ago
3 0

Answer:

Since the options were granted at an exercise price of $15 when the market value of the shares was $20, total compensation under the intrinsic method would be $5 per share on 1,000 shares or $5,000. Since the options are exercisable on 1/2/X2, the $5,000 in compensation would all be recognized n 20X1.

Explanation:

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In its 2016 annual report, Caterpillar Inc. reported the following (in millions): 2016 2015 Sales $38,537 $47,011 Cost of goods
Rom4ik [11]

Answer:

B. Gross profit decreased from 28.6% to 26.5%

Explanation:

As for the provided information, we have

Particulars                    Year 2016             Year 2015

Sales                              $38,537                $47,011

Cost of goods sold        $28,309               $33,546

Gross Profit                   $10,228                 $13,465

Gross profit as a percentage of sales shall be:

Year 2016 = \frac{10,228}{38,537} \times 100 = 28.54

Year 2015 = \frac{13,465}{47,011} \times 100 = 28.64

As the percentage is higher of 2015 by 0.1%

The statement B which states that the gross profit has reduced is correct.

6 0
3 years ago
Gallo Light began operations in 2021. The company sometimes sells used warehouses on an installment basis. In those cases, Gallo
Dvinal [7]

Answer and Explanation:

Before passing the journal entries we need to do following calculations

Particular Current year  Future taxable amounts ($ in 000s)

                        2021 2022      2023         2024  

Accounting

income         $824    

less: Permanent

difference ($34 )    

Temporary difference :      

less: installments

sales         ($570 )    $190       $190        $190  

Taxable

income          $220    

Multiply

Enacted tax rate 25%   25%          30% 30%  

Tax payable

currently      $55

Deferred tax liability        $47.5              $57       $57             $161.50

Less: Beginning balance                         $0

Change in balance : credit (debit )           $161.50

1. Now the journal entry is

On 2021

Income tax expense ($161.50 + $55) $216.50  

                        To  Deferred tax liability $161.50

                         To Income tax payable $55

(Being the income tax for 2021 is recorded)

2. And, the net income is

= Pre accounting income - income tax expense

= $824,000 - $216,500

= $607,500

3 0
3 years ago
______________ produce fundamental changes that can transform a company or even revolutionize an industry, while ______________
Whitepunk [10]

Answer: Incremental innovation ( answer for both the blanks)

           

Explanation: In simple words, incremental innovation refers to the process under which small improvement are made to the current practices of business. Such improvements through innovation results in better products and services offerings.

Such small changes however occur in large volumes and can easily revolutionize any industry.

3 0
3 years ago
How presenting a professional image through appearance, behavior, and language assists in finding employment?
Kamila [148]

Answer:

Professional image is  mandatory in finding the employment.

Explanation:

Presenting a professional image plays an important role in finding employment. It is our behavior, appearance, and way of communicating that help in attracting employment.

If our appearance is not appealing and our communication skills are weak and our behavior is not as per the requirements of the job then we might face difficulty in getting a job. Professional presentation is vital and expected by the person recruiting the employees.

8 0
3 years ago
Digital photography replacing film photography would be an example of a(n) _____. Group of answer choices radical innovation reg
Ratling [72]

Answer:

disruptive innovation.

Explanation:

A disruptive innovation can be defined as an innovation that typically creates a new market for a product by displacing or removing an existing product from the market.

Digital photography replacing film photography would be an example of a disruptive innovation.

4 0
3 years ago
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