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Ainat [17]
3 years ago
8

In order to retain certain key executives, Smiley Corporation granted them incentive stock options on December 31, 2017. 150,000

options were granted at an option price of $35 per share. Market prices of the stock were as follows: December 31, 2018 $46 per share December 31, 2019 51 per share December 31, 2020 50 per share The options were granted as compensation for executives’ services to be rendered over a two-year period beginning January 1, 2018. The Black-Scholes option pricing model determines total compensation expense to be $1,500,000. What amount of compensation expense should Smiley recognize as a result of this plan for the year ended December 31, 2019 under the fair value method?

Business
1 answer:
Mice21 [21]3 years ago
3 0

Answer:

Check the explanation

Explanation:

Kindly check the attached image below to see the step by step explanation to the question above.

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Answer:

See below

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