Martinez Audio Visual Incorporated offers an incentive stock option plan to its regional managers. On January 1
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Question:
Martinez Audio Visual Incorporated offers an incentive stock option plan to its regional managers. On January options were
granted for million $ par common shares.
The exercise price is the market price on the grant date $ per share.
Options cannot be exercised prior to January and expire December
The fair value of the million options, estimated by an appropriate option pricing model, is $ per option.
Required:
Determine the total compensation cost pertaining to the incentive stock option plan.
to Prepare the appropriate journal entries to record compensation expense on December and Prepare the
appropriate journal entry to record the exercise of of the options on March when the market price is $ per share and
the entry on December when the remaining options that have vested expire without being exercised.
Related Book For
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
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