Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On January 1, 2018, Vancouver Company granted stock options for 30,000 of its no par value common Suares to key employees, at an option price

image text in transcribed
On January 1, 2018, Vancouver Company granted stock options for 30,000 of its no par value common Suares to key employees, at an option price of $ 25. On that date, the market price of the common shares was $ 22. The Black-Scholes option pricing model determined total compensation expense to be $ 330000. The options are exercisable beginning January 1, 2021, provided the key employees are still employed by Vancouver at the time the options are exercised. The options expire on January 1, 2022. On January 2, 2021, when the market price of the shares was $ 29 per share, all 30,000 options were exercised. Using the book value method, calculate the amount that Vancouver Company would record as change to contributed surplus when the options were exercised. If it is an increase, use a positive number + If it is a decrease, use a negative number -; if no change, use zero. Do not use a comma in your answer and round to the nearest dollar

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

The AICPA Audit Committee Toolkit Private Companies

Authors: AICPA

2nd Edition

1940235464, 978-1940235462

More Books

Students also viewed these Accounting questions