Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Scenario On 1 January 2016, Tucan granted 25,000 share options to each of their 4 top executives, which they may exercise only if (a) they
Scenario On 1 January 2016, Tucan granted 25,000 share options to each of their 4 top executives, which they may exercise only if (a) they remain employed for three years following the date of grant and (b) Tucan's earnings per share in 2018 is 50% higher than it was in 2015. The fair value of each option was assessed as being 35. Tucan estimated at the time of granting the option that one of the four top executives will leave before 31 December 2018, and will therefore not become entitled to exercise the option. Tucan also believes that the earnings per share target will be met. By the end of 2016, all of the top executives are still there. However, Tucan still estimates that one will have left by 31 December 2018. Earnings per share in 2016 was up 20% compared to 2015, and the top executives remain confident that the 2018 earnings per share will reach the growth target. Based on the above information, Tucan's expense for 2016 was 875,000. During 2017, two top executives left the company. It is now estimated
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started