The journal entries for recording of compensation expense over the vesting period. Giveninformation: Number of shares as an option is100,000. Par value of common stock is $1.20. Exercise price per share is $4.80. Total option time period is 5 years. Estimated fair value at the grant date is $850,000 ( 100 , 000 shares × $ 8.5 per share ) . Initial vesting probability is 100%.

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Chapter 19, Problem 19.1E

To determine

To prepare: The journal entries for recording of compensation expense over the vesting period.

Giveninformation:

Number of shares as an option is100,000.

Par value of common stock is $1.20.

Exercise price per share is $4.80.

Total option time period is 5 years.

Estimated fair value at the grant date is $850,000 (100,000 shares×$8.5 per share) .

Initial vesting probability is 100%.

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