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Dmitry_Shevchenko [17]
3 years ago
6

On January 1, 2021, Tru Fashions Corporation awarded restricted stock units (RSUs) representing 5 million of its $1 par common s

hares to key personnel, subject to forfeiture if employment is terminated within three years.
After the recipients of the RSUs satisfy the vesting requirement, the company will distribute the shares.

On the grant date, the shares had a market price of $9.00 per share.

Required:

1. Determine the total compensation cost pertaining to the RSUs.

2. Prepare the appropriate journal entry to record the award of RSUs on January 1, 2021.

3. Prepare the appropriate journal entry to record compensation expense on December 31, 2021.

4. Prepare the appropriate journal entry to record compensation expense on December 31, 2022.

5. Prepare the appropriate journal entry to record compensation expense on December 31, 2023.

6. Prepare the appropriate journal entry to record the lifting of restrictions on the RSUs and issuing shares at December 31, 2023
Business
1 answer:
Reika [66]3 years ago
4 0

Answer and Explanation:

1.

5 million shares granted ×$9.00=$45,000,000

2. No entry is made on the grant day.

3-5 )Dr compensation expenses 15

(45 million ÷3 years)

Cr Paid in capital-restricted stock 15

Note: The entry is the same for years 2021 to 2023

6. Dr Paid in capital-restricted stock 45

Cr Common stock($5 million share×$1 par)

$5

Cr Paid in capital - excess of par (Remainder) $40

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Answer:

The answer is b. make-to-stock system

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5 0
3 years ago
In what circumstances is it most important to use multistage dividend discount models rather than constant-growth models?
patriot [66]

Answer:

when valuing companies with temporarily high growth rates.

Explanation:

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These models are based on the theory that the price of a share must be equal to the price of the dividends that the company will deliver, discounted at its net present value.

If the price of the share in the market is lower than the result obtained by the discounted dividend model, the share is undervalued and therefore it is advisable to buy. If, on the contrary, the market price is higher than the model, it is understood that the share price is too high.

Multistage dividend growth models

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The most common is to use two or three stage growths, where at first the growths are higher but then tend to stabilize at a smaller constant growth. As for example in early stage companies.

5 0
3 years ago
You are running a hot Internet company. Analysts predict that its earnings will grow at 30% per year for the next five years. Af
Andrej [43]

Answer:

The present value of the future earnings is $51,981,214.36

Explanation:

The present value of the earning can be calculated by discounting the earnings for the next five years along with calculating the terminal value of earnings at the end of the five years when the growth rate in earnings becomes constant and discounting it back to the present value.

Taking the value in millions,

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A dry cleaner uses exponential smoothing to forecast equipment usage at its main plant. August usage was forecasted to be 50 per
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Find out more on media planners at brainly.com/question/7289927.

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