Question
Employee Share Based Compensation:Options - SHOW ALL CALCULATIONS On January 1, 2018, 30 employees are granted stock options for 250 common shares each, a total
Employee Share Based Compensation:Options - SHOW ALL CALCULATIONS
On January 1, 2018, 30 employees are granted stock options for 250 common shares each, a total of 7,500 shares, at an option price of $25 per share.The options vest 4 years after the grant date.The options are valued using an option pricing model at $60,000 total.
Forfeiture estimates are updated at the end of each year:
End of Year2018201920202021
Management Estimates
-Employees expected
to remain26 (87%)24 (80%)23 (77%)n.a.
-Expected forfeitures4 (13%)6 (20%)7 (23%)n.a.
Factual History
-Actual forfeitures6120
-Employees receiving options21 (30 - 9)
REQUIRED:Preparea schedule to calculate compensation expense each year and make entries for each year to record it.(9 marks)
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