Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please show step-by-step explanation how to solve ns journalize the following. On January 1, 2021, Ayayai Inc. granted stock options to officers and key employees

Please show step-by-step explanation how to solve ns journalize the following.

On January 1, 2021, Ayayai Inc. granted stock options to officers and key employees for the purchase of22,000shares of the company's $10par common stock at $26per share. The options were exercisable within a 5-year period beginning January 1, 2023, by grantees still in the employ of the company, and expiring December 31, 2027. The service period for this award is 2 years. Assume that the fair value option-pricing model determines total compensation expense to be $356,600. On April 1, 2022,2,200options were terminated when the employees resigned from the company. The market price of the common stock was $35per share on this date. On March 31, 2023,13,200options were exercised when the market price of the common stock was $39per share. Prepare journal entries to record issuance of the stock options, termination of the stock options, exercise of the stock options, and charges to compensation expense, for the years ended December 31, 2021, 2022, and 2023.

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

Managerial accounting

Authors: ramji balakrishnan, k. s i varamakrishnan, Geoffrey b. sprin

1st edition

471467855, 978-0471467854

More Books

Students also viewed these Accounting questions