Question: 3 5 Exercise 29: Under its employee stock purchase plan, Fortune Inc. encourages employee ownership by permitting all employees to buy shares directly from their

3 5 Exercise 29: Under its employee stock purchase plan, Fortune Inc. encourages employee ownership by permitting all employees to buy shares directly from their company at 3% discount and without brokerage fees. Fortune records the sale of new shares as employees buy them. Which of the following is an accurate statement regarding this policy? The policy is inappropriate because the plan is compensatory. a. b. The company should record compensation expense when the shares are sold. c. This approach is correct and consistent with the sale of shares to non-employees. d. The policy is inappropriate because paid-in-capital should be reduced. e. The policy is inappropriate because substantially all employees can participate

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