Intermidiate Accounting II

On Jan 2, 20x1, Tin Corp. entered in a contact with three of its executive employees to offer them stock options that would allow each employee to purchase 6,000 shares of its $10-par common stock at $50 per share during the years 20x3 thru 20x7. The contract provided that these employees must perform at a high level for the next 2 years in order to qualify for these options. Experts calculated that the fair value of the options totaled $280,000. At the end of December 20x2, one of the three executives was fired due to nonperformance. On Jan 3, 20x5 the second executive exercised his options in full. The rest of the options remained unexercised by 20x8.

Q2: On Jan 2, 20x1, Tin Corp. entered in a contact with three of its executive employees to offer them stock options that would allow each employee to purchase 6,000 shares of its $10-par common stock at $50 per share during the years 20x3 thru 20x7. The contract provided that these employees must perform at a high level for the next 2 years in order to qualify for these options. Experts calculated that the fair value of the options totaled $280,000. At the end of December 20x2, one of the three executives was fired due to nonperformance. On Jan 3, 20x5 the second executive exercised his options in full. The rest of the options remained unexercised by 20x8