Issuance-exercise and termination of stock options

Assignment Help Financial Accounting

Reference no: EM13868249

(Issuance, Exercise, and Termination of Stock Options) On July 1, 2013, Hooker Financial Corporation granted 50,000 options to key executives. Each option allows the executive to purchase one share of Hooker’s $1 par value common stock at a price of $58 per share. The options were exercisable within a 2-year period beginning July 1, 2015, if the grantee is still employed by the company at the time of the exercise. On the grant date, Hooker’s stock was trading at $50 per share, and a fair value option-pricing model determines total compensation to be $350,000.

On July 1, 2015, 35,000 options were exercised when the market price of Hooker’s stock was $65 per share. The remaining options lapsed in 2015 because executives decided not to exercise their options.

Instructions

Prepare the necessary journal entries related to the stock option plan for the years 2013 through 2017.

Reference no: EM13868249

Questions Cloud

Developed conceptual framework of concepts and objectives : A soundly developed conceptual framework of concepts and objectives should

About the transactions : Jennifer opened a day care called Jennifer’s Playtime and had the following transactions. Record the journal entries in debit/credit format. Jennifer contributed the following to the business in exchange for $13,600 in common stock. Cash $5,700; comp..

How do you calculate the margin of safety : Tax Preparito budgeted revenues for 2015 of $618,000, based on a average of $206 per tax return. The company wants to achieve a margin of safety of 45%. The fixed costs are $327,600, with variable costs of $24 per customer. How do you calculate the m..

Time of the issuance of the bonds and warrants : (Issuance of Bonds with Warrants) MagTech Inc. requires funding to build a new factory and has decided to raise the additional capital by issuing $850,000 face value of bonds with a coupon rate of 10%. What entry should be made at the time of the iss..

Issuance-exercise and termination of stock options : (Issuance, Exercise, and Termination of Stock Options) On July 1, 2013, Hooker Financial Corporation granted 50,000 options to key executives. Each option allows the executive to purchase one share of Hooker’s $1 par value common stock at a price of ..

Issuance of bonds with detachable warrants : (Issuance of Bonds with Detachable Warrants) On December 1, 2014, Universal Coat Company sold 10,000 of its 10%, 15-year, $1,000 face value, nonconvertible bonds with detachable stock warrants at 102. Prepare in general journal format the entry to re..

Issuance of bonds with warrants : (Issuance of Bonds with Warrants) MagTech Inc. requires funding to build a new factory and has decided to raise the additional capital by issuing $850,000 face value of bonds with a coupon rate of 10%. In discussions with investment bankers, it was d..

Resulting in few assets remaining to pay creditors in full : Trent, Inc., has experience 2 bad financial years resulting in too few assets remaining to pay creditors in full. Trek, Inc., wants to file for bankruptcy. What are its options, and which one would be best for Trek, Inc.?

Product or period costs : Please indicate whether these are product or period costs?

User Account

All Pages