On January 1, Year 1, Sweeney Company granted an employee options to purchase 100 shares of Sweeneys

Question:

On January 1, Year 1, Sweeney Company granted an employee options to purchase 100 shares of Sweeney€™s at $ 40 per share. The options became exercisable on December 31, Year 1, after the employee had completed one year of service, and were exercised on that date. Market prices of the stock and fair values of the options were as follows:

What amount should Sweeney recognize as compensation cost for Year 1?
a. $ 6,100
b. $ 2,100
c. $ 4,000
d. $ 0

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...