Answer:
b. $2,000
Explanation:
Using a fair value option pricing model, total compensation expense is determined to be $6,000.
The service period is for three years beginning January 1, 2021.
So, Ellison should recognize compensation expense for 2021 on its books in the amount of:
= $6,000 / 3 years
= $2,000.
As a result of the option granted to Wine, using the fair value method, Ellison should recognize $2,000 as compensation expense.
Simple interest refers to the amount of money that one has to pay for borrowing a particular sum of money for a specified period of time.The simple interest is a one time calculated amount.
The compound interest is a type of interest in which the interest accrues over a period of time is compounded with the amount borrowed in order to arrive at a new principal amount. Compound interest has to be calculated regularly.
Compound interest earns more money than simple interest because the principal amount increases constantly as the result of the addition of accrued interest to the principal.
Answer: Debit: Litigation expense $300,000
Credit: Litigation liability $300,000
Explanation:
Loss contingency is typically a charge to expense for a future occurence in this case, a lawsuit. A loss contingency simply makes the economic entity to be aware at an early stage of the loss and its likely financial implication.
The entries that Buchanan should record to recognize this loss contingency will be to:
Debit: Litigation expense $300,000
Credit: Litigation liability $300,000
Answer:
It's determined by the: adjustment period.