Answer:
1. $80,000,000
2. (The Journal entries can be found below)
Explanation
1. Fair value per share x shares granted = million fair value of award
=$5×$16,000,000 = $80,000,0000
The total compensation cost pertaining to the restricted shares is $80,000,000
2. Journal entries as at December 31, 2021. ($ in millions)
Dr Compensation expense ($80 million ÷ 2 years) 40
Cr Paid-in capital—restricted stock 40
Journal entries as at December 31, 2022. ($ in millions)
Dr Compensation expense ($80 million ÷ 2 years) 40
Cr Paid-in capital—restricted stock 40
Dr Paid-in capital—restricted stock 80
CrCommon stock (16 million shares x $1 par) 16
Cr Paid-in capital—excess of par (remainder) 64
