During $2024,$ its first year of operations, Kevin Berry Industries entered into the following transactions relating to shareholders' equity.As part of its stock$-$based compensation package, International Electronics $($IE$)$ granted $34$ million stock appreciation rights $($SARs$)$ to

top officers on January $1,2024.$

At exercise, holders of the SARs are entitled to receive stock equal in value to the excess of the market price at exercise over the

share price at the date of grant.

The SARs cannot be exercised until the end of $2027($vesting date$)$ and expire at the end of $2029.$

The $$1$ par common shares have a market price of $$48$ per share on the grant date.

The fair value of the SARs, estimated by an appropriate option pricing model, is $$3$ per SAR at January $1,2024.$

The fair value re$-$estimated at December $31,2024,2025,2026,2027,$ and $2028,$ is $$4,$$$3,$$$4,$$$2\mathrm{.}50,$ and $$3,$ respectively.

All recipients are expected to remain employed through the vesting date.

Required:

$1-$a$.$ Will the SARs be reported as debt or as equity?

$1-$b to $4.$Prepare the appropriate journal entries pertaining to the SARs on January $1,2024$ and December $31,2024-$December $31,$

Assuming the SARs remain unexercised on December $31,2028,$ prepare the appropriate entry. Prepare the entry when the SARs

are exercised on June $6,2029,$ when the share price is $$50.$

Complete this question by entering your answers in the tabs below.

Req $1B$ to $4$

Prepare the appropriate journal entries pertaining to the SARs on January $1,2024$ and December $31,2024-$December $31,2027.$

Assuming the SARs remain unexercised on December $31,2028,$ prepare the appropriate entry. Prepare the entry when the SARs are

exercised on June $6,2029,$ when the share price is $$50.$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your answers in

millions rounded to $2$ decimal places $($i$.$e$.,5,500,000$ should be entered as $5\mathrm{.}50).$

The corporation was authorized to issue $100$ million common shares, $$1$ par per share.

January $2$ Issued $30$ million common shares for cash.

January $2$ Entered an agreement with the company president to issue up to $2$ million additional shares of common stock in

$2025$ based on the earnings of Berry in $2025.$ If net income exceeds $$140$ million, the president will receive $1$

million shares; $2$ million shares if net income exceeds $$150$ million.

March $31$ Issued $4$ million shares in exchange for plant facilities.

Net income for $2024$ was $$143$ million.

Required:

Compute basic and diluted earnings per share for the year ended December $31,2024.$

Note: Do not round intermediate calculations. Enter your answers in millions $($i$.$e$.,10,000,000$ should be entered as $10).$