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Aylmer Inc paid $520 for a call to purchase 850 shares of Belmont Inc on April 1, Y3.The strike price was $26.50 per share and could be exercised anytime in the next 6 months.On April 1, Y3, the market price for one share of Belmont Inc. was $29.30. Belmont's stock price rose. On June 30, Y3, the price for Belmont stock was $31.55 per share.The fair value of the option on June 30, Y3 was $7,365.                 REQUIRED      Prepare the appropriate entries under two different scenarios:  1) Aylmer exercised the option     2) Aylmer did not exercise the option (just the June 30th entry)

Aylmer Inc paid $520 for a call to purchase 850 shares of Belmont Inc on April 1, Y3.The strike price was $26.50 per share and could be exercised anytime in the next 6 months.On April 1, Y3, the market price for one share of Belmont Inc. was $29.30. Belmont's stock price rose. On June 30, Y3, the price for Belmont stock was $31.55 per share.The fair value of the option on June 30, Y3 was $7,365.                 REQUIRED      Prepare the appropriate entries under two different scenarios:  1) Aylmer exercised the option     2) Aylmer did not exercise the option (just the June 30th entry)

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter15: Contributed Capital
Section: Chapter Questions
Problem 7RE: On January 1, 2019, Phoenix Corporation adopts a performance-based share option plan for 25...
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Aylmer Inc paid $520 for a call to purchase 850 shares of Belmont Inc on April 1, Y3.The strike price was $26.50 per share and could be exercised anytime in the next 6 months.On April 1, Y3, the market price for one share of Belmont Inc. was $29.30. Belmont's stock price rose. On June 30, Y3, the price for Belmont stock was $31.55 per share.The fair value of the option on June 30, Y3 was $7,365.                 REQUIRED      Prepare the appropriate entries under two different scenarios:  1) Aylmer exercised the option     2) Aylmer did not exercise the option (just the June 30th entry)   

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