Ask Question, Ask an Expert


Ask Accounting Basics Expert

The ABC Co. granted on million employee stock options on June 30, 2006. Every option permitted the holder to buy one share of ABC common stock at $6, 00 per share that was also the stock’s selling price at that date. Options can be exercised any time after June 30, 2007.

Company used Black Scholes choice pricing model to find out fair value of the options at the grant date. That amount was $2 million. Suppose the service period in one year, ABC has a 12/31 year-end, and its tax rate is 40%.

a) Under FAS 123R, how would the transaction be reported in ABC’s 12/31/09 year-end financial statements (Balance sheet, Income statement, Cash flow statement)

b) Suppose that 20 % of options were terminated in January 2007 as certain employees had very recently left the company, Under FASB 123R, would these terminated options result in some sort of an adjustment? If there is the adjustment, create the suitable entry or entries?

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M99325

Have any Question? 

Related Questions in Accounting Basics

Business administration managemntamp commercial sciences

BUSINESS ADMINISTRATION, MANAGEMNT& COMMERCIAL SCIENCES ACCOUNTING 512 ASSIGNMENT The purpose of an assignment is to ensure that the Learner is able to: Demonstrate an understanding of accounting principles. Systematical ...

Project instructions-you have just been contracted as a

PROJECT INSTRUCTIONS- You have just been contracted as a budget consultant by LBJ Company, a distributor of bracelets to various retail outlets across the country. The company has done very little in the way of budgeting ...

1 many programming languages allow you to use to force an

1. Many programming languages allow you to use ____ to force an expression to evaluate first. A) a pound sign B) an asterisk C) parentheses D) quotation marks 2. At the beginning of any method, it is the programmer s res ...

Bull in the citation schusters express inc 66 tc 588 1976

• In the citation Schuster's Express, Inc., 66 T.C. 588 (1976), aff'd 562 F.2d 39 (CA-2, 1977), nonacq., to what do the 66, 39, and nonacq. refer? • Is there an automatic right to appeal to the U.S. Supreme Court? If so, ...

Accounting and businesshow does the business maintain its

ACCOUNTING AND BUSINESS How does the business maintain its financial records? Who does the accounting for the business? What accounting or records is used? Who periodically reviews and analyzes the accounting records? Wh ...

The assignment will require the group to undertake research

The assignment will require the group to undertake research using the website of the Australian Stock Exchange (ASX) and/or the Company whose industry is Food, Beverage & Tobacco that you have chosen. The assignment aims ...

Q1 harbour cruises limited started business on 1 july 2015

Q1. Harbour Cruises Limited started business on 1 July 2015 and completed its first statement of comprehensive income and first statement of financial position on 30 June 2016. The statements are prepared before consider ...

Module- slpaccounting cost systems and cost behavioryou are

Module- SLP ACCOUNTING COST SYSTEMS AND COST BEHAVIOR You are applying for a managerial position at an innovative and rapidly growing company. This is a dynamic company that wants an individual who adds value to the orga ...

Assignmentcarlton speciality plc is a small family owned

Assignment: Carlton Speciality PLC is a small family owned firm that manufactures custom made furniture and uses job costing system. The company does not have computerised system and thus maintains all accounting records ...

Please show your work a treasury bond that matures in 7

Please show your work. A Treasury Bond that matures in 7 years has a yield of 5.15%. A 7 year corporate bond has a yield of 7.15%. Assume that the liquidity premium on the corporate bond is 0.5%. What is the default risk ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate