Question
On December 31, 2018, Houser Company granted some of its executives options to purchase 90,000 shares of the company's $50 par common stock at an
On December 31, 2018, Houser Company granted some of its executives options to purchase 90,000 shares of the company's $50 par common stock at an option price of $60 per share. The Black-Scholes option pricing model determines total compensation expense to be $1,800,000. The options become exercisable on January 1, 2022, and represent compensation for executives' past and future services over a three-year period beginning January 1, 2019. What is the impact on Houser's total stockholders' equity for the year ended December 31, 2019, as a result of this transaction under the fair value method?
Select one:
a. $600,000 decrease
b. $0
c. $1,800,000 decrease
d. $600,000 increase
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