Provide any journal entry or entries required

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Question - On January 1st of Year 1, KK Stores, Inc., granted 30,000 options to acquire 30,000 shares of $2 par value common stock at an exercise price of $36 per share. The options vest in three years on January 1st of Year 4 and expire on January 1st of year 11. A binomial option pricing model was used to determine the fair value of the award resulting in a value of $12 per share. Kitty's uses the expected forfeiture rate method. The initial expected forfeiture rate is 0% or the vesting probability is 100%.

Required -

1. Provide any journal entry or entries required at the date of the grant.

2. Provide the journal entries required for each year of the vesting period.

3. Assuming all options are exercised on December 31st of Year 5. Help to write the journal entry to record the exercise of the options.

4. Assuming all options expire. Help to write the journal entry to record the expiration of the options on December 31st of Year 11.

Reference no: EM133131734

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