A corporation has a stock option plan it awards to its executives. On January 1, Year...

 

Transcribed Image Text:

A corporation has a stock option plan it awards to its executives. On January 1, Year 6, the board of directors granted 20,000 stock options, each of which permits the purchase of one share of stock at $25 per share, the current market price of the stock. The options are exercisable on December 31, Year 9, as long as the executives are still employed. The options expire on December 31, Year 10. The grant date fair value of each option is $5. The corporation must recognize $20,000 of compensation expense per year for 5 years. O $25,000 of compensation expense per year for 4 years. O $100,000 of compensation expense in Year 1. O $10,000 of compensation expense when the options are exercised. A corporation has a stock option plan for its employees accounted for using the fair-value method. On which of the following dates is the fair value of the stock options measured? O Expiration date. O Grant date. Forfeiture date. Exercise date. A corporation has a stock option plan it awards to its executives. On January 1, Year 6, the board of directors granted 20,000 stock options, each of which permits the purchase of one share of stock at $25 per share, the current market price of the stock. The options are exercisable on December 31, Year 9, as long as the executives are still employed. The options expire on December 31, Year 10. The grant date fair value of each option is $5. The corporation must recognize $20,000 of compensation expense per year for 5 years. O $25,000 of compensation expense per year for 4 years. O $100,000 of compensation expense in Year 1. O $10,000 of compensation expense when the options are exercised. A corporation has a stock option plan for its employees accounted for using the fair-value method. On which of the following dates is the fair value of the stock options measured? O Expiration date. O Grant date. Forfeiture date. Exercise date.

Answer rating: 100% (QA)

The detailed answer for the above question is provided below For the first question The corporation ... View the full answer