Intermediate Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (2nd Edition)
2nd Edition
ISBN: 9780134833118
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Question
Chapter 19, Problem 19.6E
a.
To determine
The value of compensation expense of the company.
Giveninformation:
Number of shares granted as SARs is 200,000.
Vesting period is 3 years.
Pre-established price at the beginning of the year is $55.
Fair value of SAR as on December 31, 2018 is $7.
Fair value of SAR as on December 31, 2019 is $13.
Fair value of SAR as on December 31, 2020 is $11.
b.
To determine
To prepare: The
Given information:
Number of shares granted as SARs is 200,000
Vesting period is 3 years.
Pre-established price at the beginning of the year is $55.
Fair value of SAR as on December 31, 2018 is $7.
Fair value of SAR as on December 31, 2019 is $13.
Fair value of SAR as on December 31, 2020 is $11.
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Ferraro, Inc. established a stock-appreciation rights (SARs) program on January 1, 2020, which entitles executives to receive cash at the date of exercise for the difference between the market price of the stock and the pre-established price of $20 on 5,000 SARs. The required service period is 2 years. The fair value of the SARs are determined to be $4 on December 31, 2020, and $9 on December 31, 2021. Compute Ferraro's compensation expense for 2020 and 2021.
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on 37,700 SARs. The date of grant is December 31, 2021, and the required employment (service) period is 4 years. President Davis
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(a)
Prepare a 5-year (2022-2026) schedule of compensation expense pertaining to the 37,700 SARS granted president Davis. (If the
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Capulet Company establishes a stock-appreciation rights program that entitles its new president Ben Davis to receive cash for the difference between the market price of the stock and a pre-established price of $30 (also market price) on December 31, 2016, on 30,000 SARs. The date of grant is December 31, 2016, and the required employment (service) period is 4 years. President Davis exercises all of the SARs in 2022. The fair value of the SARs is estimated to be $6 per SAR on December 31, 2017; $9 on December 31, 2018; $15 on December 31, 2019; $6 on December 31, 2020; and $18 on December 31, 2021.
Instructions
a. Prepare a 5-year (2017–2021) schedule of compensation expense pertaining to the 30,000 SARs granted president Davis.
b. Prepare the journal entry for compensation expense in 2017, 2020, and 2021 relative to the 30,000 SARs.
Chapter 19 Solutions
Intermediate Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (2nd Edition)
Ch. 19 - What is the allocation period used to expense...Ch. 19 - How do companies account for stock-based...Ch. 19 - Do companies with equity-based compensation plans...Ch. 19 - When accounting for employee stock options, will a...Ch. 19 - Prob. 19.5QCh. 19 - Prob. 19.6QCh. 19 - Prob. 19.7QCh. 19 - Prob. 19.8QCh. 19 - Prob. 19.9QCh. 19 - Prob. 19.10Q
Ch. 19 - Prob. 19.1MCCh. 19 - Prob. 19.2MCCh. 19 - Prob. 19.3MCCh. 19 - Prob. 19.4MCCh. 19 - Prob. 19.5MCCh. 19 - Prob. 19.6MCCh. 19 - Prob. 19.7MCCh. 19 - Prob. 19.8MCCh. 19 - Prob. 19.1BECh. 19 - Prob. 19.2BECh. 19 - Prob. 19.3BECh. 19 - Prob. 19.4BECh. 19 - Prob. 19.5BECh. 19 - Prob. 19.6BECh. 19 - Employee Stock Options, Liability-Classified...Ch. 19 - Prob. 19.8BECh. 19 - Prob. 19.12BECh. 19 - Prob. 19.13BECh. 19 - Prob. 19.14BECh. 19 - Prob. 19.15BECh. 19 - Prob. 19.16BECh. 19 - Prob. 19.17BECh. 19 - Prob. 19.18BECh. 19 - Prob. 19.19BECh. 19 - Prob. 19.20BECh. 19 - Prob. 19.21BECh. 19 - Prob. 19.22BECh. 19 - Prob. 19.23BECh. 19 - Prob. 19.24BECh. 19 - Prob. 19.25BECh. 19 - Prob. 19.26BECh. 19 - Prob. 19.27BECh. 19 - Prob. 19.28BECh. 19 - Prob. 19.1ECh. 19 - Prob. 19.2ECh. 19 - Employee Stock Options. Equity-Classified Awards....Ch. 19 - Prob. 19.4ECh. 19 - Prob. 19.6ECh. 19 - Prob. 19.7ECh. 19 - Prob. 19.8ECh. 19 - Prob. 19.9ECh. 19 - Prob. 19.10ECh. 19 - Prob. 19.11ECh. 19 - Prob. 19.13ECh. 19 - Prob. 19.14ECh. 19 - Prob. 19.15ECh. 19 - Prob. 19.1PCh. 19 - Prob. 19.2PCh. 19 - Prob. 19.3PCh. 19 - Prob. 19.5PCh. 19 - Prob. 19.6PCh. 19 - Prob. 19.7PCh. 19 - Prob. 19.8PCh. 19 - Prob. 19.9PCh. 19 - Prob. 19.10PCh. 19 - Prob. 19.11PCh. 19 - Prob. 19.12PCh. 19 - Prob. 1JCCh. 19 - Prob. 1FSCCh. 19 - Prob. 2FSCCh. 19 - Prob. 1SSCCh. 19 - Prob. 2SSCCh. 19 - Basis for Conclusions Case 1: Are Employee Stock...Ch. 19 - Prob. 2BCC
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