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On November 1,2023 , the shareholders of Crane Corp. approve a plan that grants options to the company's five executives to purchase 2,580 of the
On November 1,2023 , the shareholders of Crane Corp. approve a plan that grants options to the company's five executives to purchase 2,580 of the company's common shares each. The options are granted on January 1, 2024, and may be exercised at any time after December 31,2025 . The exercise price per share is $60. To keep this example simple, we will assume that the fair value, as determined using an options pricing model, results in a total compensation expense of $221,400. Assume that the documents that are associated with the issuance of the options indicate that the expected period of benefit/service is two years, starting on the grant date. Assume that 20%, or 2,580 , of the 12,900 options were exercised on June 1, 2027 (three years and five months after date of grant), and assume further that the remaining stock options expire and are not exercised. Prepare the journal entries to record the expiration of the remaining stock options. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. List debit entry before credit entry.)
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