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On January 2, year 1, Kine Co. granted Morgan, its president, compensatory stock options to buy 1,000 shares of Kine's $10 par common stock. The
On January 2, year 1, Kine Co. granted Morgan, its president, compensatory stock options to buy 1,000 shares of Kine's $10 par common stock. The options call for a price of $20 per share and are exercisable for three years following the grant date. Morgan exercised the options on December 31, year 1 . The market price of the stock was $50 on January 2 , year 1 , and $70 on December 31 , year 1 . The fair value of a similar stock option with the same terms was $28 on the grant date. By what net amount should stockholders' equity increase as a result of the grant and exercise of the options? $70,000$20,000$30,000$50,000
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