Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Heidi Software Corporation provides a variety of share-based compensation plans to its empioyees. Under its executive stock aption plan, the company granted options on January

image text in transcribed
Heidi Software Corporation provides a variety of share-based compensation plans to its empioyees. Under its executive stock aption plan, the company granted options on January 1, 2021, that permit executives to acquire 24 million of the company's \$i par commor shares within the next five years, but not before December 31, 2022 (the vesting date). The exercise price is the market price cf the shares on the date of grant, $5.50 per share. The fair value of the 24 million options, estirnated by an approprtate ootion pricing model, is $1 per option. No forfeitures are anticipated. Ignore taxes. Required: 1. Determine the total compensation cost pertaining to the options. 2. Prepare the appropriate journal entry to record the award of options on January 1, 2021. 3. Prepare the appropriate journal entry to record compensation expense on December 31,2021 . 4. Prepare the appropriate journal entry to record compensation expense on December 31, 2022 Complete this question by entering your answers in the tabs below. Heidi Software Corporation provides a variety of share-based compensation plans to its empioyees. Under its executive stock aption plan, the company granted options on January 1, 2021, that permit executives to acquire 24 million of the company's \$i par commor shares within the next five years, but not before December 31, 2022 (the vesting date). The exercise price is the market price cf the shares on the date of grant, $5.50 per share. The fair value of the 24 million options, estirnated by an approprtate ootion pricing model, is $1 per option. No forfeitures are anticipated. Ignore taxes. Required: 1. Determine the total compensation cost pertaining to the options. 2. Prepare the appropriate journal entry to record the award of options on January 1, 2021. 3. Prepare the appropriate journal entry to record compensation expense on December 31,2021 . 4. Prepare the appropriate journal entry to record compensation expense on December 31, 2022 Complete this question by entering your answers in the tabs below

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Issues In Finance And Monetary Policy

Authors: J. McCombie ,C. Rodríguez González

1st Edition

0230007988,0230801498

More Books

Students also viewed these Finance questions